Moody’s Corporation provides comprehensive perspectives on risk to more than 15,000 customers in 165 countries, including 97% of the Fortune 100. Founded in 1909 as a credit rating agency, the company provides independent, forward-looking opinions on credit risk that help businesses, governments and financial leaders make informed decisions on borrowing or lending money through the Moody’s Ratings division. Meanwhile, Moody’s Analytics division offers data, analytics, and insights that help organizations understand the risks of doing business in an increasingly complex world, such as supply chain risk, cyber risk, compliance and sanctions risk, among others.

Published by Moody’s Ratings, credit ratings are forward-looking opinions of the relative credit risks of debt obligations, such as issued bonds, owed by companies, governments or other corporate borrowers. Moody’s defines credit risk as the risk that a debt issuer (also known colloquially as a “borrower”) may not meet its contractual financial obligations as they come due. This definition also takes into consideration any estimated financial loss in the event of default. Ratings are assigned to financial instruments as well as to borrowers. For a more complete description of Moody’s credit ratings, please click here.

Moody’s Ratings rates various legal entities and debt obligations across industries and sectors, including publicly and privately held companies, financial institutions, securitized finance vehicles, project finance vehicles, and public sector entities including governments and supranational organizations.

In addition to credit ratings, Moody’s Ratings assigns outlooks, which serve as opinions regarding the likely direction of a credit rating over the medium term. Rating outlooks fall into four categories: Positive, Negative, Stable, and Developing. A Stable outlook indicates a low likelihood of a credit rating change over the medium term. A Negative, Positive, or Developing outlook indicates a higher likelihood that the credit rating may change in the medium term. In most cases, Moody’s Ratings follows up on an outlook change in about 12-18 months. For a more complete description of a Moody’s outlooks, please click here.

Moody’s Ratings assigns credit ratings on global long-term and short-term rating scales. Long-term credit ratings are assigned to borrowers or debt with an original maturity of 11 months or more, while short-term credit ratings are assigned to debts with an original maturity of 13 months or less.

Moody’s Ratings global long-term credit ratings are expressed on a 21-point rating scale that ranges from Aaa to C. Long-term ratings range from Aaa (highest quality and subject to the lowest level of credit risk) to C (lowest rated and typically in default, with little prospect for recovery of principal or interest).

Short-term credit ratings include Prime-1 (P-1), Prime-2 (P-2), and Prime-3 (P-3), which reflect a superior ability, strong ability, and acceptable ability to repay short-term obligations, respectively. Borrowers that do not fall within any of the Prime rating categories are assigned Not Prime (NP). For more detailed information, please see Moody’s rating scale for an overview or page 6 in this document for a complete explanation.

Moody’s Ratings credit ratings are determined by committees of rating analysts using published methodologies corresponding to the sector or category of the borrower or obligation being rated. Moody’s Ratings credit rating methodologies are publicly available and take into consideration quantitative and qualitative factors in determining the likelihood that the borrower will fulfill its debt obligations on time and in full. The rating committee will assign a credit rating based on Moody’s rating scale.  For more information on Moody’s Ratings’ methodologies, please visit the Rating Methodologies page on our website.

A Moody’s Ratings downgrade means that a committee of rating analysts has determined that a borrower’s credit profile is relatively weaker, and that the borrower is therefore less likely to meet its debts on time and in full than previously expected. When a rating committee makes this determination, it will lower the borrower’s credit rating downward on Moody’s Ratings rating scale. Moody’s Ratings analysts continuously monitor credit ratings, and downgrades can be prompted by a range of factors related to the entity’s financial health, economic or industry conditions, or specific events.

A Moody’s Ratings upgrade means that a committee of rating analysts has determined that a borrower’s credit profile is relatively stronger, and that the borrower is therefore more likely to meet its debts on time and in full than previously expected. When a rating committee makes this determination, it will raise the borrower’s credit rating upward on Moody’s Ratings rating scale. Moody’s Ratings analysts continuously monitor credit ratings, and upgrades can be prompted by a range of factors related to the entity’s financial health, economic or industry conditions, or specific events.

Moody’s Corporation has several revenue streams, split between two primary businesses. The first is Moody’s Ratings, the credit rating agency, which is generally paid by debt borrowers to assign and monitor credit ratings. Moody’s Ratings also publishes in-depth research and commentary on credit-related topics, which can cover individual borrowers, sectors or the wider economy. This research is made available on a commercial basis by another division of Moody’s Corporation, Moody’s Analytics. Beyond the output from Moody’s Ratings, the Moody’s Analytics also sells subscription-based risk management solutions to corporations, governments, financial institutions, and other market participants. These include vast datasets, financial modeling software, economic models, compliance solutions, and more.

Moody’s Corporation (NYSE:MCO) is publicly traded on the New York Stock Exchange. Its shareholders include a mix of institutional investors, mutual funds, hedge funds, and individual investors.

Moody’s Ratings credit ratings, the associated credit rating announcements, disclosures, and the methodologies used to assign those credit ratings, are made freely available on our websites. Research and other analysis of credit markets and specific sectors of the economy are available to subscribers. Moody’s Analytics’ risk management solutions – including its datasets, economic forecasts, and risk modeling software – are generally subscription-based.

Moody’s Analytics is the division of Moody’s Corporation that provides data, intelligence, and analytical tools to help business and financial leaders make decisions. Together with Moody’s Ratings, it provides Moody’s Corporation’s integrated risk assessment capabilities.

Moody’s Ratings’ annual default study, which is designed to measure the predictive quality of our global corporate ratings, shows that, since 1983, Moody’s average one-year default and loss position (AP) is 91%. For 2024 alone, that metric is 95%. This statistic shows how successful Moody’s Ratings is in rank ordering borrowers and predicting which ones are more likely to default than others. A higher percentage shows a better rank ordering of borrowers and prediction of which ones will default. Moody’s Ratings makes all of its performance studies available through its regularly-updated Guide to Moody’s Default Research.

Customers may use Moody’s Ratings credit ratings, industry research, data, and analyses to identify a wide range of investment opportunities and risks. Customers may use Moody’s Analytics’ services to help gain a broad view of the global debt market; create debt strategies; navigate market volatility; and to understand and manage risks associated with specific sectors, markets and industries.

Moody’s Corporation is a leading provider of credit ratings and research through Moody’s Ratings and of data, analytics and insights through Moody’s Analytics. It helps businesses, governments and other entities around the globe anticipate, adapt and thrive during periods of uncertainty and increased risk. Moody’s Corporation plays an important role in the economy by providing opinions, insights and data that can help businesses, governments and financial leaders make informed decisions about borrowing or lending money. Some of these decisions include capital investments into municipal infrastructure, government projects, or business development or growth. By providing rich data, analysis, and robust tools, Moody’s Corporation helps these stakeholders to discern opportunity, advance their business, and act decisively.

Moody’s Ratings credit ratings provide insight into the relative creditworthiness of capital market investments, helping stakeholders make more informed decisions on borrowing or lending money, as well other credit assessments. These decisions help foster greater market efficiency and stability, as investors make informed decisions, and as borrowers organize themselves to attract the best loan terms.