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Item 2. Management’s Discussion and Analysis

2023-11-02 compared with 2023-07-27 · 245 added, 242 removed, 673 unchanged (42% of the section changed)

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The following Management's Discussion and Analysis (“MD&A”) provides a narrative of the results of operations and financial condition of S&P Global Inc.

(together with its consolidated subsidiaries, (“S&P Global,” the “Company,” “we,” “us” or “our”) for the three and six months ended June 30, 2023.

(together with its consolidated subsidiaries, “S&P Global,” the “Company,” “we,” “us” or “our”) for the three and nine months ended September 30, 2023.

The MD&A should be read in conjunction with the consolidated financial statements, accompanying notes and MD&A included in our Form 10-K for the year ended December 31, 2022 (our “Form 10-K”), which have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

The MD&A includes the following sections:

• Results of Operations — Comparing the Three and Six Months Ended June 30, 2023 and 2022

• Results of Operations — Comparing the Three and Nine Months Ended September 30, 2023 and 2022

• Liquidity and Capital Resources

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• Forward-Looking Statements

We are a provider of credit ratings, benchmarks, analytics and workflow solutions in the global capital, commodity, automotive and engineering markets.

We are a provider of credit ratings, benchmarks, analytics and workflow solutions in the global capital, commodity and automotive markets.

The capital markets include asset managers, investment banks, commercial banks, insurance companies, exchanges, trading firms and issuers;

the commodity markets include producers, traders and intermediaries within energy, petrochemicals, metals & steel and agriculture;

the automotive markets include manufacturers, suppliers, dealerships and service shops;

and the engineering markets include engineers, builders, and architects.

and the automotive markets include manufacturers, suppliers, dealerships and service shops.

Our operations consist of six reportable segments:

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• Indices is a global index provider maintaining a wide variety of valuation and index benchmarks for investment advisors, wealth managers and institutional investors.

• Engineering Solutions is a leading provider of engineering standards and related technical knowledge.

As of May 2, 2023, we completed the sale of Engineering Solutions and the results are included through that date.

On May 2, 2023, we completed the sale of Engineering Solutions to Allium Buyer LLC, a Delaware limited liability company controlled by funds affiliated with Kohlberg Kravis Roberts & Co.

• As of May 2, 2023, we completed the sale of Engineering Solutions, a leading provider of engineering standards and related technical knowledge, and the results are included through that date.

On May 2, 2023, we completed the sale of Engineering Solutions to Allium Buyer LLC, a Delaware limited liability company controlled by funds affili ated with Kohlberg Kravis Roberts & Co.

We received the full proceeds from the sale of $975 million in cash, subject to purchase price adjustments, which we expect to result in approximately $750 million in after-tax proceeds.

The assets and liabilities of Engineering Solutions were classified as held for sale in our consolidated balance sheet as of December 31, 2022.

During the three months ended June 30, 2023, we recorded a pre-tax loss of $120 million in Loss (gain) on dispositions and disposition-related costs of $3 million in selling and general expenses in the consolidated statement of income ($189 million after-tax, net of a release of a deferred tax liability of $101 million) related to the sale of Engineering Solutions.

During the six months ended June 30, 2023, we recorded a pre-tax loss of $120 million in Loss (gain) on dispositions and disposition-related costs of $16 million in selling and general expenses in the consolidated statement of income ($182 million after-tax, net of a release of a deferred tax liability of $157 million) related to the sale of Engineering Solutions.

The transaction follows our announced intent in November of 2022 to divest the business.

During the nine months ended September 30, 2023, we recorded a pre-tax loss of $120 million in Loss (gain) on dispositions and disposition-related costs of $16 million in selling and general expenses in the consolidated statement of income ($182 million after-tax, net of a release of a deferred tax liability of $157 million) related to the sale of Engineering Solutions.

The transaction followed our announced intent in November of 2022 to divest the business.

Engineering Solutions became part of the Company following our merger with IH S Markit.

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See Note 2 - Acquisitions and Divestitures for additional information.

Key results for the periods ended June 30 are as follows:

(in millions) Three Months Six Months

Key results for the periods ended September 30 are as follows:

(in millions) Three Months Nine Months

2023 2022 % Change 1

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1 % changes in the tables throughout the MD&A are calculated off of the actual number, not the rounded number presented.

2 Operating profit for the three months ended June 30, 2023 includes a loss on disposition of $120 million, IHS Markit merger costs of $51 million, employee severance charges of $51 million, disposition-related costs of $3 million, and acquisition-related costs of $2 million.

Operating profit for the six months ended June 30, 2023 includes IHS Markit merger costs of $115 million, a loss on disposition of $69 million, employee severance charges of $62 million, disposition-related costs of $16 million, and acquisition-related costs of $3 million.

Operating profit for the three and six months ended June 30, 2023 includes lease impairments of $15 million and asset impairment of $5 million.

Operating profit for the three months ended June 30, 2022 includes a gain on dispositions of $556 million, IHS Markit merger costs of $135 million, employee severance charges of $61 million, acquisition-related costs of $7 million and an asset impairment of $3 million.

Operating profit for the six months ended June 30, 2022 includes a gain on dispositions of $1.9 billion, IHS Markit merger costs of $379 million, a S&P Foundation grant of $200 million, employee severance charges of $139 million, acquisition-related costs of $8 million, lease impairments of $5 million and an asset write-off of $3 million.

Operating profit also includes amortization of intangibles from acquisitions of $275 million and $282 million for the three months ended June 30, 2023 and 2022, respectively, and $550 million and $407 million for the six months ended June 30, 2023 and 2022, respectively.

Revenue increased 4% driven by increases at Ratings, Market Intelligence, Mobility, Commodity Insights and Indices, partially offset by a decrease at Engineering Solutions which was unfavorably impacted by its sale on May 2, 2023.

The increase at Ratings was primarily due to growth in corporate bond ratings transaction revenue driven by increased investment-grade and high-yield issuance volumes due to an increase in refinancing activity.

The increase at Market Intelligence was primarily due to subscription revenue growth for data feed products within Data and Advisory Solutions, work flow solutions at Enterprise Solutions, Desktop products, and RatingsXpress®, RatingsDirect® and Credit Analytics within Credit & Risk Solutions.

The increase at Mobility was primarily due to price increases and new business growth within the Dealer business as well as the favorable impact of the acquisition of Market Scan in February of 2023.

2 Operating profit for the three months ended September 30, 2023 includes IHS Markit merger costs of $58 million, employee severance charges of $38 million, disposition-related costs of $3 million, acquisition-related costs of $2 million and an asset write-off of $1 million.

Operating profit for the nine months ended September 30, 2023 includes IHS Markit merger costs of $173 million, employee severance charges of $101 million, a loss on disposition of $70 million, disposition-related costs of $19 million, lease impairments of $15 million, an asset impairment of $5 million, acquisition-related costs of $5 million and an asset write-off of $1 million.

Operating profit for the three months ended September 30, 2022 includes IHS Markit merger costs of $144 million, employee severance charges of $55 million, an acquisition-related benefit of $18 million, a gain on acquisition of $10 million, an asset impairment of $9 million, a loss on dispositions of $2 million and an asset write-off of $1 million.

Operating profit for the nine months ended September 30, 2022 includes a gain on dispositions of $1.9 billion, IHS Markit merger costs of $523 million, a S&P Foundation grant of $200 million, employee severance charges of $195 million, a gain on acquisition of $10 million, an asset impairment of $9 million, an acquisition-related benefit of $6 million, lease impairments of $5 million and an asset write-off of $4 million.

Operating profit also includes amortization of intangibles from acquisitions of $274 million and $280 million for the three months ended September 30, 2023 and 2022, respectively, and $824 million and $687 million for the nine months ended September 30, 2023 and 2022, respectively.

Revenue increased 8% driven by increases at Ratings, Market Intelligence, Commodity Insights, Mobility and Indices, partially offset by a decrease at Engineering Solutions due to its sale on May 2, 2023.

The increase at Ratings was driven by growth in both transaction revenue and non-transaction revenue.

Transaction revenue increased due to growth in corporate bond ratings revenue driven by increased high-yield and bank loan issuance volumes primarily due to higher refinancing activity.

Non-transaction revenue increased due to an increase in surveillance revenue, a cumulative catch-up for customers' unreported commercial paper issuance, higher Ratings Evaluation Service (“RES”) revenue and an increase in revenue at our CRISIL subsidiary.

The increase at Market Intelligence was primarily due to subscription revenue growth for data feed products within Data and Advisory Solutions, work flow solutions at Enterprise Solutions, RatingsXpress®, RatingsDirect® and Credit Analytics within Credit & Risk Solutions, and Market Intelligence Desktop products.

Revenue growth at Commodity Insights was primarily due to continued demand for market data and market insights products.

The increase at Indices was primarily due to higher exchange-traded derivative revenue and higher data subscription revenue.

Foreign exchange rates had an unfavorable impact of less than 1 percentage point.

Operating profit decreased 39%.

Excluding the unfavorable impact of a higher gain on dispositions in 2022 of 45 percentage points and higher lease impairments in 2023 of 1 percentage point, partially offset by higher IHS Markit merger costs in 2022 of 6 percentage points, operating profit increased 1%.

The increase was primarily due to revenue growth, partially offset by increased incentives and higher compensation costs.

The increase at Mobility was primarily due to price increases and new business growth within the Dealer business as well as the favorable impact of the acquisition of Market Scan in February of 2023.

The increase at Indices was primarily due to higher exchange-traded derivative revenue and higher asset-linked fees revenue.

Foreign exchange rates had a favorable impact of 1 percentage point.

Operating profit increased 26%.

Excluding the impact of higher IHS Markit merger costs in 2022 of 15 percentage points, higher employee severance charges in 2022 of 3 percentage points, an asset impairment in 2022 of 2 percentage points and higher amortization of intangibles in 2022 of 1 percentage point, partially offset by an acquisition-related benefit in 2022 of 3 percentage points and a gain on acquisition in 2022 of 2 percentage points, operating profit increased 10%.

The increase was primarily due to revenue growth, partially offset by increased incentives and higher compensation costs.

Foreign exchange rates had a favorable impact of 2 percentage points.

Revenue increased 13% primarily due to the impact of the merger with IHS Markit;

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continued demand for market data and market insights products and higher conference revenue at Commodity Insights;

higher exchange-traded derivative revenue and higher data subscription revenue at Indices;

and growth in corporate bond ratings transaction revenue driven by increased investment-grade and high-yield issuance volumes due to an increase in refinancing activity at Ratings.

These increases were partially offset by a decrease at Engineering Solutions which was unfavorably impacted by the sale on May 2, 2023 and lower bank loan ratings revenue at Ratings.

price increases and new business growth within the Dealer business as well as the favorable impact of the acquisition of Market Scan in February of 2023 at Mobility;

growth in corporate bond ratings transaction revenue driven by increased investment-grade and high-yield issuance volumes due to an increase in refinancing activity and higher non-transaction revenue due to an increase in surveillance revenue, a cumulative catch-up for customers' unreported commercial paper issuance, an increase in revenue at our CRISIL subsidiary and higher RES revenue, partially offset by a decrease in new entity credit ratings revenue at Ratings;

and higher exchange-traded derivative revenue and higher data subscription revenue at Indices.

These increases were partially offset by a decrease at Engineering Solutions due to its sale on May 2, 2023.

Foreign exchange rates had an unfavorable impact of 1 percentage point.

Operating profit decreased 26%.

Excluding the unfavorable impact of a higher gain on dispositions in 2022 of 61 percentage points and higher amortization of intangibles in 2023 of 4 percentage points, partially offset by the impact of higher IHS Markit merger costs in 2022 of 8 percentage points, the impact of a S&P Foundation grant in 2022 of 6 percentage points and higher employee severance charges in 2022 of 2 percentage points, operating profit increased 10%.

The increase was primarily due to revenue growth, partially offset by expenses associated with the merger with IHS Markit, increased incentives, higher compensation costs and an increase in technology costs.

Excluding the unfavorable impact of a higher gain on dispositions in 2022 of 47 percentage points and higher amortization of intangibles in 2023 of 3 percentage points, partially offset by the impact of higher IHS Markit merger costs in 2022 of 8 percentage points, the impact of a S&P Foundation grant in 2022 of 5 percentage points and higher employee severance charges in 2022 of 1 percentage point, operating profit increased 10%.

The increase was primarily due to revenue growth, partially offset by expenses associated with the merger with IHS Markit, increased incentives and higher compensation costs.

Foreign exchange rates had a favorable impact of 1 percentage point.

We are a provider of credit ratings, benchmarks, analytics and workflow solutions in the global capital, commodity, automotive and engineering markets.

We are a provider of credit ratings, benchmarks, analytics and workflow solutions in the global capital, commodity and automotive markets.

Our purpose is to accelerate progress.

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See Item 1A, Risk Factors in this Form 10-Q and our most recently filed Annual Report on Form 10-K.

RESULTS OF OPERATIONS — COMPARING THE THREE AND SIX MONTHS ENDED JUNE 30, 2023 AND 2022

RESULTS OF OPERATIONS — COMPARING THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2023 AND 2022

Consolidated Review

(in millions) Three Months Six Months

(in millions) Three Months Nine Months

2023 2022 % Change 2023 2022 % Change

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Total expenses 2,018 2,012 —% 6,179 5,934 4%

Loss (gain) on dispositions 119 (556) N/M 69 (1,899) N/M

Loss (gain) on dispositions — 2 (80)% 69 (1,897) N/M

Equity in income on unconsolidated subsidiaries (8) (6) 29% (33) (21) 61%

Operating profit 1,074 853 26% 3,130 4,228 (26)%

Other income, net (11) (1) N/M — (50) N/M

Other income, net (5) (37) 87% (5) (86) 95%

Interest expense, net 84 71 18% 258 218 18%

Loss on extinguishment of debt, net — 2 N/M — 19 N/M

(Gain) loss on extinguishment of debt, net — (4) N/M — 15 N/M

Provision for taxes on income 181 145 25% 628 1,053 (40)%

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N/M – Represents a change equal to or in excess of 100% or not meaningful

The following table provides consolidated revenue information for the periods ended June 30:

(in millions) Three Months Six Months

The following table provides consolidated revenue information for the periods ended September 30:

(in millions) Three Months Nine Months

2023 2022 % Change 2023 2022 % Change

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International revenue 40 % 40 % 40 % 40 %

Revenue increased 4% as compared to the three months ended June 30, 2022.

Subscription revenue increased due growth in data feed products within Data and Advisory Solutions, work flow solutions at Enterprise Solutions, Desktop products, and RatingsXpress®, RatingsDirect® and Credit Analytics within Credit & Risk Solutions at Market Intelligence, price increases and new business growth within the Dealer business as well as the favorable impact of the acquisition of Market Scan in February of 2023 at Mobility, continued demand for Commodity Insights market data and market insights products and higher data subscription revenue at Indices, partially offset by a decrease at Engineering Solutions which was unfavorably impacted by its sale on May 2, 2023.

Non-subscription / transaction revenue increased primarily due to growth in corporate bond ratings revenue driven by increased investment-grade and high-yield issuance volumes due to an increase in refinancing activity at Ratings.

Non-transaction revenue increased due to an increase in surveillance revenue, higher Ratings Evaluation Service (“RES”) revenue and an increase in revenue at our CRISIL subsidiary, partially offset by a decrease in new entity credit ratings revenue.

Asset linked fees decreased at Indices driven by product mix.

Revenue increased 8% as compared to the three months ended September 30, 2022.

Subscription revenue increased in the three month period primarily due to growth in data feed products within Data and Advisory Solutions, work flow solutions at Enterprise Solutions, RatingsXpress®, RatingsDirect® and Credit Analytics within Credit & Risk Solutions and Desktop products at Market Intelligence, price increases and new business growth within the Dealer business as well as the favorable impact of the acquisition of Market Scan in February of 2023 at Mobility and continued demand for Commodity Insights market data and market insights products, partially offset by a decrease at Engineering Solutions due to its sale on May 2, 2023.

Non-subscription / transaction revenue increased primarily due to growth in corporate bond ratings revenue driven by increased high-yield and bank loan issuance volumes primarily due to higher refinancing activity.

Asset linked fees increased at Indices due to higher levels of assets under management (“AUM”) for ETFs, partially offset by product mix.

The increase in sales-usage based royalties was primarily driven by higher exchange-traded derivative revenue at Indices.

An increase in sales usage-based royalties from the licensing of our proprietary market data and price assessments to commodity exchanges at Commodity Insights also contributed to revenue growth.

Recurring variable revenue at Market Intelligence increased due to fixed income new issuance volumes.

See “Segment Review” below for further information.

The unfavorable impact of foreign exchange rates reduced revenue by less than 1 percentage point.

The favorable impact of foreign exchange rates increased revenue by 1 percentage point.

This impact refers to constant currency comparisons estimated by recalculating current year results of foreign operations using the average exchange rate from the prior year.

Revenue increased 16% as compared to the six months ended June 30, 2022.

Subscription revenue increased primarily due to the impact of the merger with IHS Markit.

Subscription revenue growth in Desktop products, Credit & Risk Solutions and Data & Advisory Solutions at Market Intelligence, continued demand for Commodity Insights market data and market insights products and higher data subscription revenue at Indices, partially offset by a decrease at Engineering Solutions which was unfavorably impacted by its sale on May 2, 2023.

Non-subscription / transaction revenue increased due to the impact of the merger with IHS Markit, growth in corporate bond ratings revenue driven by increased investment-grade and high-yield issuance volumes due to an increase in refinancing activity at Ratings and an increase in conference revenue at Commodity Insights, partially offset by a decrease in bank loan ratings revenue at Ratings.

Non-transaction revenue decreased due to a decrease in new entity credit ratings revenue, partially offset by an increase in surveillance revenue and an increase in revenue at our CRISIL subsidiary.

Revenue increased 13% as compared to the nine months ended September 30, 2022.

Subscription revenue increased in the nine month period primarily due to the impact of the merger with IHS Markit.

Non-transaction revenue increased due to an increase in surveillance revenue, a cumulative catch-up for customers' unreported commercial paper issuance, an increase in revenue at our CRISIL subsidiary and higher RES revenue, partially offset by a decrease in new entity credit ratings revenue.

Asset linked fees decreased at Indices driven by product mix.

The increase in sales-usage based royalties was primarily driven by higher exchange-traded derivative revenue at Indices.

Recurring variable revenue at Market Intelligence increased due to the impact of the merger with IHS Markit and represents revenue from contracts for services that specify a fee based on, among other factors, the number of trades processed, assets under management, or the number of positions valued.

An increase in sales usage-based royalties from the licensing of our proprietary market data and price assessments to commodity exchanges at Commodity Insights also contributed to revenue growth.

Recurring variable revenue at Market Intelligence

increased due to the impact of the merger with IHS Markit and fixed income new issuance volumes.

See “Segment Review” below for further information.

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Total Expenses

The following tables provide an analysis by segment of our operating-related expenses and selling and general expenses for the periods ended June 30:

The following tables provide an analysis by segment of our operating-related expenses and selling and general expenses for the periods ended September 30:

(in millions) 2023 2022 % Change

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Engineering Solutions 6

22 6 59 22 (62)% (71)%

— — 58 23 N/M N/M

Intersegment eliminations 7

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N/M – Represents a change equal to or in excess of 100% or not meaningful

1 In 2023 selling and general expenses include employee severance charges of $16 million, IHS Markit merger costs of $12 million, and an asset impairment of $5 million.

1 In 2023, selling and general expenses include employee severance charges of $19 million, IHS Markit merger costs of $11 million and an asset write-off of $1 million.

In 2022, selling and general expenses include include employee severance charges of $13 million, IHS Markit merger costs of $6 million and acquisition-related costs of $1 million.

2 In 2023 and 2022, selling and general expenses include employee severance charges of $4 million and $7 million, respectively.

3 In 2023, selling and general expenses include employee severance charges of $14 million and IHS Markit merger costs of $8 million.

In 2022, selling and general expenses include employee severance costs of $17 million and acquisition-related costs of $4 million.

4 In 2023, selling and general expenses include employee severance charges of $3 million and acquisition-related costs of $1 million.

In 2022, selling and general expenses include acquisition-related costs of $3 million, employee severance charges of $2 million, and IHS Markit merger costs of $1 million.

2 In 2023 and 2022, selling and general expenses include employee severance charges of $2 million.

3 In 2023, selling and general expenses include IHS Markit merger costs of $8 million and employee severance charges of $7 million.

In 2022, selling and general expenses include employee severance charges of $14 million and IHS Markit merger costs of $10 million.

In 2022, selling and general expenses include employee severance charges of $2 million and acquisition-related costs of $1 million.

4 In 2023, selling and general expenses include employee severance charges of $3 million, IHS Markit merger costs of $1 million and acquisition-related costs of $1 million.

In 2022, selling and general expenses include an acquisition-related benefit of $19 million and employee severance charges of $1 million.

5 In 2023 and 2022, selling and general expenses include employee severance charges of $1 million and IHS Markit merger costs of $1 million.

6 In 2022, selling and general expenses include employee severance charges of $2 million.

7 Intersegment eliminations primarily relate to a royalty charged to Market Intelligence for the rights to use and distribute content and data developed by Ratings.

8 In 2023, selling and general expenses include IHS Markit merger costs of $30 million, lease impairments of $15 million, employee severance charges of $12 million, disposition-related costs of $3 million, and acquisition-related costs of $1 million.

In 2022, selling and general expenses include IHS Markit merger costs of $117 million, employee severance charges of $18 million, acquisition-related costs of $4 million, and an asset write-off of $3 million.

8 In 2023, selling and general expenses include IHS Markit merger costs of $37 million, employee severance charges of $6 million, disposition-related costs of $3 million and acquisition-related costs of $1 million.

In 2022, selling and general expenses include IHS Markit merger costs of $127 million, employee severance charges of $23 million, a gain on acquisition of $10 million, an asset impairment of $9 million and acquisition-related costs of $1 million.

Operating-Related Expenses

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Selling and General Expenses

Selling and general expenses increased less than 1%.

Excluding the favorable impact of higher IHS Markit merger costs in 2022 of 15 percentage points, higher employee severance charges in 2022 of 2 percentage points, higher acquisition-related costs in 2022 of 1 percentage point, partially offset by higher lease impairments in 2023 of 3 percentage points, selling and general expenses increased 15%.

Selling and general expenses increased 2%.

Excluding the favorable impact of higher IHS Markit merger costs in 2022 of 17 percentage points, higher employee severance charges in 2022 of 3 percentage points, and an asset write-off of 2 percentage points, partially offset by an acquisition-related benefit in 2022 of 4 percentage points, a gain on acquisition in 2022 of 2 percentage points and disposition-related costs in 2023 of 1 percentage point, selling and general expenses increased 17%.

The increase was primarily driven by increased incentives and higher compensation costs.

Depreciation and Amortization

Depreciation and amortization decreased to $285 million in 2023 compared to $303 million in 2022, primarily due to lower depreciation driven by asset disposals and lower intangible asset amortization driven by the impact of the sale of Engineering Solutions on May 2, 2023.

Depreciation and amortization decreased to $282 million in 2023 compared to $298 million in 2022, primarily due to lower depreciation driven by asset disposals and lower intangible asset amortization driven by the sale of Engineering Solutions on May 2, 2023.

(in millions) 2023 2022 % Change

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N/M – Represents a change equal to or in excess of 100% or not meaningful

1 In 2023 selling and general expenses include IHS Markit merger costs of $25 million, employee severance charges of $22 million, and an asset impairment of $5 million.

1 In 2023 selling and general expenses include employee severance charges of $41 million, IHS Markit merger costs of $36 million, an asset impairment of $5 million and an asset write-off of $1 million.

In 2022, selling and general expenses include employee severance charges of $44 million, IHS Markit merger costs of $21 million and acquisition-related costs of $2 million.

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3 In 2023, selling and general expenses include IHS Markit merger costs of $28 million and employee severance charges of $23 million.

In 2022, selling and general expenses include employee severance costs of $24 million and IHS Markit merger costs of $6 million.

4 In 2023, selling and general expenses include employee severance charges of $4 million, acquisition-related costs of $1 million, and IHS Markit merger costs of $1 million.

In 2022, selling and general expenses include acquisition-related costs of $4 million, employee severance charges of $2 million, and IHS Markit merger costs of $1 million.

In 2022, selling and general expenses include employee severance charges of $38 million and IHS Markit merger costs of $16 million.

4 In 2023, selling and general expenses include employee severance charges of $6 million, IHS Markit merger costs of $2 million and acquisition-related costs of $2 million.

In 2022, selling and general expenses include acquisition-related benefit of $15 million, employee severance charges of $3 million and IHS Markit merger costs of $1 million.

5 In 2023, selling and general expenses include employee severance charges of $4 million and IHS Markit merger costs of $3 million.

In 2022, selling and general expenses include employee severance charges of $4 million and IHS Markit merger costs of $1 million.

6 In 2022, selling and general expenses include employee severance charges of $4 million.

7 Intersegment eliminations primarily relate to a royalty charged to Market Intelligence for the rights to use and distribute content and data developed by Ratings.

8 In 2023, selling and general expenses include IHS Markit merger costs of $66 million, lease impairments of $15 million, disposition-related costs of $16 million, employee severance charges of $14 million, and acquisition-related costs of $2 million.

In 2022, selling and general expenses include IHS Markit merger costs of $357 million, a S&P Foundation grant of $200 million, employee severance charges of $64 million, acquisition-related costs of $5 million, lease impairments of $5 million, and an asset write-off of $3 million.

8 In 2023, selling and general expenses include IHS Markit merger costs of $104 million, employee severance charges of $20 million, disposition-related costs of $19 million, lease impairments of $15 million and acquisition-related costs of $3 million.

In 2022, selling and general expenses include IHS Markit merger costs of $483 million, a S&P Foundation grant of $200 million, employee severance

charges of $87 million, a gain on acquisition of $10 million, an asset impairment of $9 million, acquisition-related costs of $7 million, lease impairments of $5 million and an asset write-off of $3 million.

Operating-Related Expenses

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Selling and general expenses decreased 10%.

Excluding the favorable impact of higher IHS Markit merger costs in 2022 of 21

percentage points, a S&P Foundation grant in 2022 of 16 percentage points and higher employee severance charges in 2022 of 6 percentage points, partially offset by disposition-related costs in 2023 of 1 percentage points and higher lease impairments in 2023 of 1 percentage point, selling and general expenses increased 27%.

Excluding the favorable impact of higher IHS Markit merger costs in 2022 of 19 percentage points, a S&P Foundation grant in 2022 of 11 percentage points and higher employee severance charges in 2022 of 5 percentage points, partially offset by disposition-related costs in 2023 of 1 percentage point, selling and general expenses increased 24%.

The increase was primarily driven by the impact of the merger with IHS Markit, increased incentives and higher compensation costs.

Depreciation and Amortization

Depreciation and amortization increased to $571 million in 2023 compared to $441 million in 2022, primarily due to higher intangible asset amortization driven by the impact of the merger with IHS Markit, partially offset by lower intangible asset amortization driven by the impact of the sale of Engineering Solutions on May 2, 2023.

Depreciation and amortization increased to $853 million in 2023 compared to $738 million in 2022, primarily due to higher intangible asset amortization driven by the impact of the merger with IHS Markit, partially offset by lower intangible asset amortization driven by the sale of Engineering Solutions on May 2, 2023.

Loss (Gain) on Dispositions

During the three and six months ended June 30, 2023, we completed the following disposition and received a contingent payment that were included in Loss (gain) on dispositions in the consolidated statements of income:

• During the three months ended June 30, 2023, we recorded a pre-tax loss of $120 million in Loss (gain) on dispositions and disposition-related costs of $3 million in selling and general expenses in the consolidated statement of income ($189 million after-tax, net of a release of a deferred tax liability of $101 million) related to the sale of Engineering Solutions.

During the nine months ended September 30, 2023, we completed the following disposition and received a contingent payment that were included in Loss (gain) on dispositions in the consolidated statements of income:

• During the nine months ended September 30, 2023, we recorded a pre-tax loss of $120 million in Loss (gain) on dispositions and disposition-related costs of $16 million in selling and general expenses in the consolidated statement of income ($182 million after-tax, net of a release of a deferred tax liability of $157 million) related to the sale of Engineering Solutions.

• In the first quarter of 2023, we received a contingent payment following the sale of Leveraged Commentary and Data (“LCD”) along with a related family of leveraged loan indices in June of 2022.

The contingent payment was payable six months following the closing upon the achievement of certain conditions related to the transition of LCD customer relationships.

During the six months ended June 30, 2023, the contingent payment resulted in a pre-tax gain of $46 million ($34 million after-tax) related to the sale of LCD in our Market Intelligence segment and $4 million ($3 million after-tax) related to the sale of a family of leveraged loan indices in our Indices segment.

During the six months ended June 30, 2022, we completed the following dispositions that were included in Loss (gain) on dispositions in the consolidated statement of income:

During the nine months ended September 30, 2023, the contingent payment resulted in a pre-tax gain of $46 million ($34 million after-tax) related to the sale of LCD in our Market Intelligence segment and $4 million ($3 million after-tax) related to the sale of a family of leveraged loan indices in our Indices segment.

During the three and nine months ended September 30, 2022, we completed the following dispositions that resulted in a pre-tax loss of $2 million and a pre-tax gain of $1,897 million, respectively, which was included in Loss (gain) on dispositions in the consolidated statement of income:

• In June of 2022, we completed the previously announced sale of LCD along with a related family of leveraged loan indices, within our Market Intelligence and Indices segments, respectively, to Morningstar for a purchase price of $600 million in cash, subject to customary adjustments, and a contingent payment of up to $50 million which was payable six months following the closing upon the achievement of certain conditions related to the transition of LCD customer relationships.

During the three and six months ended June 30, 2022, we recorded a pre-tax gain of $518 million ($396 million after tax) for the sale of LCD and $38 million ($31 million after tax) for the sale of a family of leveraged loan indices in Loss (gain) on dispositions in the consolidated statements of income.

During the three and nine months ended September 30, 2022, we recorded a pre-tax loss of $15 million ($11 million after-tax) and a pre-tax gain of $505 million ($378 million after tax) for the sale of LCD.

During the three and nine months ended September 30, 2022, we recorded a pre-tax gain of $14 million ($12 million after-tax) and $52 million ($43 million after-tax) for the sale of a family of leveraged loan indices in Loss (gain) on dispositions in the consolidated statements of income.

• In June of 2022, we completed the previously announced sale of the Base Chemicals business to News Corp for $295 million in cash.

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for a purchase price of $1.925 billion in cash, subject to customary adjustments.

During the six months ended June 30, 2022, we recorded a pre-tax gain of $1.344 billion ($1.006 billion after tax) in Loss (gain) on dispositions in the consolidated statements of income related to the sale of CGS.

During the three and nine months ended September 30, 2022, we recorded a pre-tax loss of $2 million ($2 million after-tax) and a pre-tax gain of $1.341 billion ($1.005 billion after tax) in Loss (gain) on dispositions in the consolidated statements of income related to the sale of CGS.

• In February of 2022, we completed the previously announced sale of Oil Price Information Services (“OPIS”) to News Corp for $1.150 billion in cash.

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GAAP, and may not be defined and calculated by other companies in the same manner.

The tables below reconcile segment operating profit to total operating profit for the periods ended June 30:

The tables below reconcile segment operating profit to total operating profit for the periods ended September 30:

(in millions) 2023 2022 % Change

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Commodity Insights 3

226 270 (16)%

Engineering Solutions 6

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N/M – Represents a change equal to or in excess of 100% or not meaningful

1 2023 includes employee severance charges of $16 million, IHS Markit merger costs of $12 million, and an asset impairment of $5 million.

2022 includes a gain on disposition of $518 million, employee severance charges of $13 million, IHS Markit merger costs of $12 million, and acquisition-related costs of $1 million.

1 2023 includes employee severance charges of $19 million, IHS Markit merger costs of $11 million, and an asset write-off of $1 million.

2022 includes a loss on disposition of $17 million, employee severance charges of $13 million, IHS Markit merger costs of $6 million and acquisition-related costs of $1 million.

2023 and 2022 include amortization of intangibles from acquisitions of $140 million and $134 million, respectively.

2 2023 and 2022 include employee severance charges of $4 million and $7 million, respectively.

2023 and 2022 both include amortization of intangibles from acquisitions of $2 million.

3 2023 includes employee severance charges of $14 million and IHS Markit merger costs of $8 million.

2 2023 and 2022 include employee severance charges of $2 million and amortization of intangibles from acquisitions of $2 million.

3 2023 includes IHS Markit merger costs of $8 million and employee severance charges of $7 million.

2022 includes employee severance charges of $14 million and IHS Markit merger costs of $10 million.

2023 and 2022 include amortization of intangibles from acquisitions of $33 million and $32 million, respectively.

4 2023 includes employee severance charges of $3 million and acquisition-related costs of $1 million.

2022 includes acquisition-related costs of $3 million, employee severance charges of $2 million, and IHS Markit merger costs of $1 million.

2023 and 2022 include amortization of intangibles from acquisitions of $76 million a nd $77 million , respectively.

4 2023 includes employee severance charges of $3 million, IHS Markit merger costs of $1 million and acquisition-related costs of $1 million.

2022 includes acquisition-related benefit of $19 million, employee severance charges of $1 million and IHS Markit merger costs of $1 million.

2023 and 2022 include amortization of intangibles from acquisitions of $76 million.

5 2023 includes employee severance charges of $1 million and IHS Markit merger costs of $1 million.

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2023 and 2022 include amortization of intangibles from acquisitions of $9 million.

6 2022 includes employee severance charges of $1 million.

2022 includes amortization of intangibles from acquisitions of $15 million.

7 2023 includes a loss on disposition of $120 million, IHS Markit merger costs of $30 million, lease impairments of $15 million, employee severance charges of $12 million, disposition-related costs of $3 million, and acquisition-related costs of $1 million.

2022 includes IHS Markit merger costs of $117 million, employee severance charges of $18 million, acquisition-related costs of $4 million, and an asset write-off of $3 million.

2023 includes amortization of intangibles from acquisitions of $1 million.

8 2023 and 2022 include amortization of intangibles from acquisitions of $14 million.

Segment Operating Profit — Segment operating profit decreased 32% as compared to 2022.

Excluding the unfavorable impact of a higher gain on dispositions in 2022 of 34 percentage points, segment operating profit increased 2%.

6 2022 includes employee severance charges of $2 million and amortization of intangibles from acquisitions of $14 million.

7 2023 includes IHS Markit merger costs of $37 million, employee severance charges of $6 million, disposition-related costs of $3 million and acquisition-related costs of $1 million.

2022 includes IHS Markit merger costs of $127 million, employee severance charges of $23 million, an asset impairment of $9 million, a gain on acquisition of $10 million and acquisition-related costs of $1 million.

8 2023 and 2022 include amortization of intangibles from acquisitions of $14 million and $13 million, respectively.

Segment Operating Profit — Segment operating profit increased 13% as compared to 2022.

Excluding the acquisition-related benefit in 2022 of 3 percentage points, partially offset by higher amortization of intangibles in 2022 of 1 percentage point, segment operating profit increased 11%.

The increase was primarily due to revenue growth, partially offset by increased incentives and higher compensation costs.

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Corporate Unallocated Expense — Corporate Unallocated expense includes costs for corporate functions, select initiatives, unoccupied office space and Kensho, included in selling and general expenses.

Corporate Unallocated expense increased 31% compared to 2022.

Excluding the impact of a loss on disposition in 2023 of 103 percentage points and lease impairments in 2023 of 13 percentage points, partially offset by higher IHS Markit merger costs in 2022 of 76 percentage points, higher employee severance charges in 2022 of 5 percentage points and an asset write-off in 2022 of 3 percentage points, Corporate Unallocated expense increased 63% primarily due to increased incentives.

Corporate Unallocated expense decreased 50% compared to 2022.

Excluding the impact of higher IHS Markit merger costs in 2022 of 102 percentage points, higher employee severance charges in 2022 of 19 percentage points and an asset impairment in 2022 of 10 percentage points, partially offset by a gain on acquisition of 11 percentage points and higher disposition-related costs in 2023 of 3 percentage points, Corporate Unallocated expense increased 67% primarily due to increased incentives.

Equity in Income on Unconsolidated Subsidiaries — The Company holds an investment in a 50/50 joint venture arrangement with shared control with CME Group that combined each company’s post-trade services into a joint venture, OSTTRA.

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Equity in Income on Unconsolidated Subsidiaries includes the OSTTRA joint venture acquired in connection with the merger with IHS Markit.

Equity in Income on Unconsolidated Subsidiaries was $11 million for the three months ended June 30, 2023 and June 30, 2022.

Foreign exchange rates had a favorable impact on operating profit of 1 percentage point.

Equity in Income on Unconsolidated Subsidiaries was $8 million and $6 million for the three months ended September 30, 2023 and 2022, respectively.

Foreign exchange rates had a favorable impact on operating profit of 2 percentage points.

This impact refers to constant currency comparisons and the remeasurement of monetary assets and liabilities.

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$ 599 $ 2,366 (75)%

1,422 1,352 5%

Commodity Insights 3

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N/M – Represents a change equal to or in excess of 100% or not meaningful

1 2023 includes a gain on disposition of $46 million, IHS Markit merger costs of $25 million, employee severance charges of $22 million, and an asset impairment of $5 million.

1 2023 includes a gain on disposition of $46 million, employee severance charges of $41 million, IHS Markit merger costs of $36 million, an asset impairment of $5 million and an asset write-off of $1 million.

2022 includes a gain on disposition of $1.8 billion, employee severance charges of $44 million, IHS Markit merger costs of $21 million and acquisition-related costs of $2 million.

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2023 and 2022 include amortization of intangibles from acquisitions of $99 million and $77 million, respectively.

4 2023 includes employee severance charges of $4 million, acquisition-related costs of $1 million, and IHS Markit merger costs of $1 million.

2022 includes acquisition-related costs of $4 million, employee severance charges of $2 million, and IHS Markit merger costs of $1 million.

2023 and 2022 include amortization of intangibles from acquisitions of $150 million a nd $101 million , respectively.

4 2023 includes employee severance charges of $6 million, IHS Markit merger costs of $2 million and acquisition-related costs of $2 million.

2022 includes an acquisition-related benefit of $15 million, employee severance charges of $3 million and IHS Markit merger costs of $1 million.

2023 and 2022 include amortization of intangibles from acquisitions of $226 million and $176 million, respectively.

5 2023 includes a gain on disposition of $4 million, employee severance charges of $4 million and IHS Markit merger costs of $3 million.

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2023 and 2022 include amortization of intangibles from acquisitions of $1 million and $33 million, respectively.

7 2023 includes a loss on disposition of $120 million, IHS Markit merger costs of $66 million, lease impairments of $15 million, employee severance charges of $14 million, disposition-related costs of $16 million, and acquisition-related costs of $2 million.

2022 includes IHS Markit merger costs of $357 million, S&P Foundation grant of $200 million, employee severance charges of $64 million, acquisition-related costs of $5 million, lease impairments of $5 million, and an asset write-off of $3 million.

7 2023 includes a loss on disposition of $120 million, IHS Markit merger costs of $104 million, employee severance charges of $20 million, disposition-related costs of $19 million, lease impairments of $15 million and acquisition-related costs of $3 million.

2022 includes IHS Markit merger costs of $483 million, a S&P Foundation grant of $200 million, employee severance charges of $87 million, a gain on acquisition of $10 million, asset impairment of $9 million, acquisition-related costs of $7 million, lease impairments of $5 million and asset write-off of $3 million.

2023 and 2022 include amortization of intangibles from acquisitions of $2 million and $1 million, respectively.

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Excluding the unfavorable impact of a higher gain on dispositions in 2022 of 39 percentage points, higher amortization of intangibles from acquisitions in 2023 of 3 percentage points and higher IHS Markit merger costs in 2023 of 1 percentage point, partially offset by higher employee severance charges in 2022 of 1 percentage point, segment operating profit increased 11%.

The increase was primarily due to revenue growth, partially offset by increased incentives, higher compensation costs and an increase in technology costs.

The increase was primarily due to revenue growth, partially offset by increased incentives and higher compensation costs.

See “Segment Review” below for further information.

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Corporate Unallocated expense decreased 55% compared to 2022.

Excluding the impact of higher IHS Markit merger costs in 2022 of 70 percentage points, a S&P Foundation grant in 2022 of 48 percentage points, higher employee severance charges in 2022 of 12 percentage points and higher acquisition-related costs in 2022 of 1 percentage point, partially offset by a loss on disposition in 2023 of 28 percentage points, disposition-related costs in 2023 of 4 percentage points and lease impairments of 2 percentage points, Corporate Unallocated expense increased 40% primarily due to increased incentives.

Excluding the impact of higher IHS Markit merger costs in 2022 of 78 percentage points, a S&P Foundation grant in 2022 of 41 percentage points, higher employee severance charges in 2022 of 14 percentage points, an asset impairment of in 2022 of 2 percentage points, an asset write-off in 2022 of 1 percentage point and higher acquisition-related costs in 2022 of 1 percentage point, partially offset by a loss on disposition in 2023 of 25 percentage points, disposition-related costs in 2023 of 4 percentage points, a gain on acquisition in 2022 of 2 percentage points and higher lease impairments in 2023 of 2 percentage points, Corporate Unallocated expense increased 49% primarily due to increased incentives.

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Equity in Income on Unconsolidated Subsidiaries includes the OSTTRA joint venture acquired in connection with the merger with IHS Markit.

Equity in Income on Unconsolidated Subsidiaries was $25 million and $15 million for the six months ended June 30, 2023 and June 30, 2022, respectively.

Equity in Income on Unconsolidated Subsidiaries was $33 million and $21 million for the nine months ended September 30, 2023 and 2022, respectively.

Foreign exchange rates had a favorable impact on operating profit of 1 percentage point.

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Other income, net includes gains and losses on our mark-to-market investments and the net periodic benefit cost for our retirement and post retirement plans.

Other income, net increased compared to the three months ended June 30, 2022 primarily due to gains on our mark-to-market investments in 2023 compared to losses in 2022 and decreased compared to the six months ended June 30, 2022 primarily due to losses on our mark-to-market investments in 2023 compared to gains in 2022.

Other income, net increased compared to the three months and nine months ended September 30, 2022 primarily due to gains on our mark-to-market investments in 2023 compared to losses in 2022.

Interest Expense, net

Interest expense, net decreased $2 million compared to the three months ended June 30, 2022.

Interest expense, net increased $27 million compared to the six months ended June 30, 2022, primarily due to higher debt balances in 2023 resulting from the Exchange Offer that took place in March of 2022 in connection with the merger of IHS Markit.

Interest expense, net increased $13 million compared to the three months ended September 30, 2022 primarily due to incremental expense related to outstanding commercial paper borrowings and the issuance of $750 million 5.25% senior notes in September of 2023.

Interest expense, net increased $40 million compared to the three and nine months ended September 30, 2022, respectively, primarily due to higher debt balances in 2023 resulting from the Exchange Offer that took place in March of 2022 in connection with the merger of IHS Markit.

Loss on Extinguishment of Debt, net

During the six months ended June 30, 2022, we recognized a $19 million loss on extinguishment of debt which includes a $118 million tender premium paid to tendering note holders in accordance with the terms of the tender offer, offset by a $99 million non-cash write-off related to the fair market value step up premium on extinguished debt.

During the three and nine months ended September 30, 2022, we recognized a $4 million gain and a $15 million loss on extinguishment of debt.

The nine months ended September 30, 2022 includes a $142 million tender premium paid to tendering note holders in accordance with the terms of the tender offer, offset by a $127 million non-cash write-off related to the fair market value step up premium on extinguished debt.

Provision for Income Taxes

The effective income tax rate was 31.1% and 23.8% for the three and six months ended June 30, 2023, respectively, and 24.5% and 27.9% for the three and six months ended June 30, 2022, respectively.

The higher rate for the three months ended June 30, 2023 was primarily due to the tax charge on divestitures.

The higher rate for the six months ended June 30, 2022 was primarily due to the tax charge on merger related divestitures and deal related non-deductible costs.

The effective income tax rate was 18.2% and 21.8% for the three and nine months ended September 30, 2023, respectively, and 17.6% and 25.8% for the three and nine months ended September 30, 2022, respectively.

The lower rate for the three months ended September 30, 2022 was primarily due to a combination of discrete adjustments including transaction costs.

The higher rate for the nine months ended September 30, 2022 was primarily due to tax charge on merger related divestitures and deal related non-deductible costs.

Segment Review

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In the first quarter of 2023, we received a contingent payment following the sale of Leveraged Commentary and Data (“LCD”) that resulted in a pre-tax gain of $46 million ($34 million after-tax) which was included in Loss (gain) on dispositions in the consolidated statements of income.

In June of 2022, we completed the previously announced sale of Leveraged Commentary and Data (“LCD”), a business within our Market Intelligence segment, to Morningstar.

During the three and six months ended June 30, 2022, we recorded a pre-tax gain of $518 million ($396 million after-tax) for the sale of LCD in Loss (gain) on dispositions in the consolidated statements of income.

In June of 2022, we completed the previously announced sale of LCD, a business within our Market Intelligence segment, to Morningstar.

During the three and nine months ended September 30, 2022, we recorded a pre-tax loss of $15 million ($11 million after-tax) and a pre-tax gain of $505 million ($378 million after-tax), respectively, for the sale of LCD in Loss (gain) on dispositions in the consolidated statements of income.

In March of 2022, we completed the previously announced sale of CUSIP Global Services (“CGS”), a business within our Market Intelligence segment, to FactSet Research Systems Inc.

for a purchase price of $1.925 billion in cash, subject to customary adjustments.

During the six months ended June 30 2022, we recorded a pre-tax gain of $1.344 billion ($1.006 billion after tax) in Loss (gain) on dispositions in the consolidated statements of income related to the sale of CGS.

During the three and nine months ended September 30, 2022, we recorded a pre-tax loss of $2 million ($2 million after-tax) and a pre-tax gain of $1.341 billion ($1.005 billion after-tax), respectively, in Loss (gain) on dispositions in the consolidated statements of income related to the sale of CGS.

See Note 2 - Acquisitions and Divestitures to the consolidated financial statements of this Form 10-Q for information on the merger with IHS Markit.

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Non-subscription revenue at Market Intelligence is primarily related to certain advisory, pricing conferences and events, and analytical services.

The following table provides revenue and segment operating profit information for the periods ended June 30:

(in millions) Three Months Six Months

The following table provides revenue and segment operating profit information for the periods ended September 30:

(in millions) Three Months Nine Months

2023 2022 % Change 2023 2022 % Change

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Operating margin % 18 % 17 % 18 % 85 %

1 Operating profit for the three and six months ended June 30, 2023 includes employee severance charges of $16 million and $22 million, respectively, IHS Markit merger costs of $12 million and $25 million, respectively, and an asset impairment of $5 million.

Operating profit for the six months ended June 30, 2023 includes a gain on dispositions of $46 million.

Operating profit for the three and six months ended June 30, 2022 includes a gain on dispositions of $518 million and $1.9 billion, respectively, employee severance charges of $13 million and $31 million, respectively, IHS Markit merger costs of $12 million and $15 million, respectively, and acquisition-related costs of $1 million.

Additionally, operating profit includes amortization of intangibles from acquisitions of $140 million and $133 million for the three months ended June 30, 2023 and 2022, respectively, and $281 million and $197 million for the six months ended June 30, 2023 and 2022, respectively.

Revenue increased 5% primarily due to subscription revenue growth for data feed products within Data and Advisory Solutions, work flow solutions at Enterprise Solutions, Market Intelligence Desktop products, and RatingsXpress®, RatingsDirect® and Credit Analytics within Credit & Risk Solutions.

1 Operating profit for the three and nine months ended September 30, 2023 includes employee severance charges of $19 million and $41 million, respectively, IHS Markit merger costs of $11 million and $36 million, respectively, and an asset write-off of $1 million.

Operating profit for the nine months ended September 30, 2023 includes a gain on dispositions of $46 million and an asset impairment of $5 million.

Operating profit for the three and nine months ended September 30, 2022 includes a loss on dispositions of $17 million and gain on dispositions $1.8 billion, respectively, employee severance charges of $13 million and $44 million, respectively, IHS Markit merger costs of $6 million and $21 million, respectively, and acquisition-related costs of $1 million and $2 million, respectively.

Additionally, operating profit includes amortization of intangibles from acquisitions of $140 million and $134 million for the three months ended September 30, 2023 and 2022, respectively, and $421 million and $331 million for the nine months ended September 30, 2023 and 2022, respectively.

Revenue increased 8% primarily due to subscription revenue growth for data feed products within Data and Advisory Solutions, work flow solutions at Enterprise Solutions, RatingsXpress®, RatingsDirect® and Credit Analytics within Credit & Risk Solutions, and Market Intelligence Desktop products.

An increase in recurring variable revenue due to fixed income new issuance volumes also contributed to revenue growth.

Foreign exchange rates had an unfavorable impact of less than 1 percentage point.

Operating profit decreas ed 75%.

Excludi ng the impact of a gain on dispositions in 2022 of 75 percentage points and higher amortization of intangibles in 2023 of 1 percentage point, operating profit increased 1% primarily due to revenue growth, partially offset by higher compensation costs and increased incentives.

Foreign exchange rates had a favorable impact of 1 percentage point.

Operating profit increased 12%.

Excluding the impact of a gain on dispositions in 2022 of 150 percentage points, higher acquisition-related costs in 2022 of 6 percentage points, partially offset by higher amortization of intangibles in 2023 of 55 percentage points, higher employee severance charges in 2023 of 55 percentage points, higher IHS Markit merger costs in 2023 of 47 percentage points and an asset write-off of 5 percentage points, operating profit increased 6% primarily due to revenue growth, partially offset by higher compensation costs and increased incentives.

Foreign exchange rates had a favorable impact of 3 percentage points.

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Subscription revenue growth for Market Intelligence Desktop products, RatingsXpress®, RatingsDirect®, and data feed products within Data and Advisory Solutions also contributed to revenue growth.

Foreign exchange rates had an unfavorable impact of 1 percentage point.

Foreign exchange rates had an unfavorable impact of less than 1 percentage point.

Operating profit decreased 75%.

Ex cludi ng the impact of a higher gain on dispositions in 2022 of 97 percentage points, higher

amortization of intangibles in 2023 of 5 percentage points and higher IHS Markit merger costs in 2023 of 1 percentage point, operating profit increased 21% primarily due to revenue growth, partially offset by expenses associated with the merger with IHS Markit, higher compensation costs and increased incentives.

Foreign exchange rates had an unfavorable impact of 1 percentage point.

Ex cludi ng the impact of a higher gain on dispositions in 2022 of 85 percentage points, higher amortization of intangibles in 2023 of 4 percentage points and higher IHS Markit merger costs in 2023 of 1 percentage point, operating profit increased 15% primarily due to revenue growth, partially offset by expenses associated with the merger with IHS Markit, higher compensation costs and increased incentives.

Foreign exchange rates had a favorable impact of 1 percentage point.

For a further discussion of competitive and other risks inherent in our Market Intelligence business, see Item 1A, Risk Factors in this Form 10-Q and our most recently filed Annual Report on Form 10-K.

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Non-transaction revenue also includes an intersegment royalty charged to Market Intelligence for the rights to use and distribute content and data developed by Ratings.

Royalty revenue was $38 million and $74 million three and six months ended June 30, 2023 and 2022, respectively, and $36 million and $70 million for the three and six months ended June 30, 2022, respectively.

The following table provides revenue and segment operating profit information for the periods ended June 30:

(in millions) Three Months Six Months

Royalty revenue was $38 million and $113 million for the three and nine months ended September 30, 2023, respectively, and $36 million and $107 million for the three and nine months ended September 30, 2022, respectively.

The following table provides revenue and segment operating profit information for the periods ended September 30:

(in millions) Three Months Nine Months

2023 2022 % Change 2023 2022 % Change

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Operating margin % 56 % 55 % 57 % 58 %

1 Operating profit for the three and six months ended June 30, 2023 includes employee severance charges of $4 million and $5 million, respectively.

Operating profit for the three and six months ended June 30, 2022 includes employee severance charges of $7 million and $12 million, respectively.

Additionally, operating profit includes amortization of intangibles from acquisitions of $2 million for the three months ended June 30, 2023 and 2022, and $4 million and $3 million for the six months ended June 30, 2023 and 2022, respectively.

Revenue increased 7%, with an unfavorable impact from foreign exchange rates of less than 1 percentage point.

Transaction revenue increased due to growth in corporate bond ratings revenue driven by increased investment-grade and high-yield issuance volumes primarily due to higher refinancing activity, partially offset by a decrease in structured finance revenues and lower bank loan ratings revenue driven by decreased issuance volumes.

1 Operating profit for the three and nine months ended September 30, 2023 includes employee severance charges of $2 million and $8 million, respectively.

Operating profit for the three and nine months ended September 30, 2022 includes employee severance charges of $2 million and $14 million, respectively.

Additionally, operating profit includes amortization of intangibles from acquisitions of $2 million for the three months ended September 30, 2023 and 2022, and $6 million and $5 million for the nine months ended September 30, 2023 and 2022, respectively.

Revenue increased 20%, with a favorable impact from foreign exchange rates of 1 percentage point.

Transaction revenue increased due to growth in corporate bond ratings revenue driven by increased high-yield and bank loan issuance volumes primarily due to higher refinancing activity.

Transaction and non-transaction revenue also benefited from improved contract terms across product categories.

Operating profit increased 5%, with a favorable impact from foreign exchange rates of less than 1 percentage point.

Excluding the impact of higher employee severance charges in 2022 of 1 percentage point, operating profit increased 4% due to revenue growth, partially offset by prior-year write-downs in incentive compensation as result of financial performance and higher current-year compensation costs.

Revenue increased 1%, with an unfavorable impact from foreign exchange rates of 1 percentage point.

Transaction revenue increased due to growth in corporate bond ratings revenue driven by increased investment-grade and high-yield issuance volumes primarily due to higher refinancing activity, partially offset by lower bank loan ratings revenue driven by decreased issuance volumes.

Non-transaction revenue decreased due to a decrease in new entity credit ratings revenue, partially offset by an increase in surveillance revenue and an increase in revenue at our CRISIL subsidiary.

Operating profit increased 22%, with a favorable impact from foreign exchange rates of 2 percentage points, due to revenue growth, partially offset by prior-year write-downs in incentive compensation as result of financial performance and higher current-year compensation costs.

Revenue increased 6%, with an unfavorable impact from foreign exchange rates of less than 1 percentage point.

Transaction revenue increased due to growth in corporate bond ratings revenue driven by increased investment-grade and high-yield issuance volumes primarily due to higher refinancing activity, partially offset by lower bank loan ratings revenue driven by decreased issuance volumes in the first half of 2023.

Transaction and non-transaction revenue also benefited from improved contract terms across product categories.

Operating profit decreased 1%, with a favorable impact from foreign exchange rates of less than 1 percentage point.

Excluding the impact of higher employee severance charges in 2022 of 1 percentage point, operating profit decreased 2% primarily due to prior-year write-downs in incentive compensation as result of financial performance and higher current-year compensation costs, partially offset by revenue growth.

Operating profit increased 5%, with a favorable impact from foreign exchange rates of 1 percentage point, due to revenue growth, partially offset by prior-year write-downs in incentive compensation as result of financial performance and higher current-year compensation costs.

Market Issuance Volumes

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The following tables depict changes in issuance levels as compared to the prior year based on data from SDC Platinum for Corporate bond issuance and based on a composite of external data feeds and Ratings' internal estimates for Structured Finance issuance.

Second Quarter

Third Quarter

Compared to Prior Year Year-to-Date

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** Includes rated and non-rated issuance.

• Corporate issuance was up in the second quarter and first half of 2023 in the U.S.

and Europe driven by strong increases in high-yield issuance and investment-grade issuance in the quarter due to an increase in refinancing activity ahead of the U.S.

debt ceiling expiration date and anticipated interest rate increases.

Second Quarter Compared to Prior Year Year-to-Date Compared to Prior Year

• High-yield issuance was up in the third quarter of 2023 in the U.S.

and Europe due to an increase in refinancing activity.

Corporate issuance in the U.S.

was down for the quarter driven by weakness in investment grade issuance.

Third Quarter Compared to Prior Year Year-to-Date Compared to Prior Year

Structured Finance Issuance U.S.

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* Represents no activity in 2023 or 2022.

• ABS issuance decreased in the U.S.

driven by a decline in Credit Cards and Non-Traditional / Esoterics and was up in Europe although from a low 2022 base.

• ABS issuance increased in the U.S.

and Europe driven by auto loans, with Europe also up from a low 2022 base.

• CLO issuance was down in the U.S.

structured credit markets due to a decline in new and refinancing issuance and down in Europe due to a decline in refinancing issuance.

• CMBS issuance was down in the U.S.

and Europe reflecting unfavorable market conditions.

• RMBS issuance was down in the U.S.

and Europe structured credit markets due to a decline in new issuance.

• CMBS and RMBS issuance was down in the U.S.

reflecting unfavorable market conditions.

• Covered bond (debt securities backed by mortgages or other high-quality assets that remain on the issuer's balance sheet) issuance in Europe increased with the elimination of cheaper government funding programs.

• Covered bond (debt securities backed by mortgages or other high-quality assets that remain on the issuer's balance sheet) issuance in Europe decreased with weakening loan and deposit growth due to higher interest rates and weaker consumer confidence.

For a further discussion of competitive and other risks inherent in our Ratings business, see Item 1A, Risk Factors in this Form 10-Q and our most recently filed Annual Report on Form 10-K.

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See Note 2 - Acquisitions and Divestitures to the consolidated financial statements of this Form 10-Q for information on the merger with IHS Markit.

The following table provides revenue and segment operating profit information for the periods ended June 30:

(in millions) Three Months Six Months

The following table provides revenue and segment operating profit information for the periods ended September 30:

(in millions) Three Months Nine Months

2023 2022 % Change 2023 2022 % Change

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Operating margin % 38 % 33 % 36 % 36 %

1 Operating profit for the three and six months ended June 30, 2023 includes employee severance charges of $14 million and $15 million, respectively, and IHS Markit merger costs of $8 million and $20 million, respectively.

Operating profit for the three and six months ended June 30, 2022 includes employee severance costs of $17 million and $24 million, respectively, and IHS Markit merger costs of $4 million and $6 million, respectively.

Additionally, operating profit includes amortization of intangibles from acquisitions of $33 million and $32 million for the three months ended June 30, 2023 and 2022, respectively, and $66 million and $45 million for the six months ended June 30, 2023 and 2022, respectively.

Revenue increased 5% primarily due to continued demand for market data and market insights products driven by expanded product offerings to our existing customers under enterprise use contracts and higher conference revenue.

An increase in sales usage-based royalties from the licensing of our proprietary market data and price assessments to commodity exchanges mainly due to increased trading volumes across all commodity sectors also contributed to revenue growth.

Revenue growth was partially offset by the unfavorable impact of divestitures in 2022.

1 Operating profit for the three and nine months ended September 30, 2023 includes IHS Markit merger costs of $8 million and $28 million, respectively, and employee severance charges of $7 million and $23 million, respectively.

Operating profit for the three and nine months ended September 30, 2022 includes employee severance costs of $14 million and $38 million, respectively, and IHS Markit merger costs of $10 million and $16 million, respectively.

Additionally, operating profit includes amortization of intangibles from acquisitions of $33 million and $32 million for the three months ended September 30, 2023 and 2022, respectively, and $99 million and $77 million for the nine months ended September 30, 2023 and 2022, respectively.

Revenue increased 11% primarily due to continued demand for market data and market insights products driven by expanded product offerings to our existing customers under enterprise use contracts.

The Energy & Resources Data & Insights, Price Assessments and Upstream Data & Insights businesses continue to be the most significant revenue streams, followed by the Advisory & Transactional Services business.

Foreign exchange rates had an unfavorable impact of less than 1 percentage point.

Foreign exchange rates had a favorable impact of less than 1 percentage point.

Operating profit increased 31%.

Excluding the impact of higher IHS Markit merger costs in 2023 of 9 percentage points, higher amortization of intangibles from acquisitions in 2023 of 1 percentage point, partially offset by higher employee severance charges in 2022 of 7 percentage points and acquisition-related costs in 2022 of 1 percentage point, operating profit increased 8%.

Excluding the impact of higher employee severance charges in 2022 of 11 percentage points and higher IHS Markit merger costs in 2022 of 3 percentage points, operating profit increased 17%.

The increase was primarily due to revenue growth partially offset by higher compensation costs, increased incentives and an increase in strategic investments.

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Operating profit increased 20%.

Excluding the impact of higher amortization of intangibles from acquisitions in 2023 of 3

percentage points and higher IHS Markit merger costs in 2023 of 2 percentage points, partially offset by higher employee severance charges in 2022 of 1 percentage point and acquisition-related costs in 2022 of 1 percentage point, operating profit increased 19%.

Excluding the impact of higher amortization of intangibles from acquisitions in 2023 of 2 percentage points and higher IHS Markit merger costs in 2023 of 1 percentage point, partially offset by higher employee

severance charges in 2022 of 1 percentage point, operating profit increased 18%.

The increase was primarily due to revenue growth partially offset by expenses associated with the merger with IHS Markit, higher compensation costs, increased incentives, an increase in costs related to the Commodity Insights conferences in 2023 and an increase in strategic investments.

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• Non-subscription revenue — One-time transactional sales of data that are non-cyclical in nature – and that are usually tied to underlying business metrics such as OEM marketing spend or safety recall activity – as well as consulting and advisory services.

The Mobility business was acquired in connection with the merger with IHS Markit on February 28, 2022 and financial results are included since the date of acquisition.

See Note 2 - Acquisitions and Divestitures to the consolidated financial statements of this Form 10-Q for information on the merger with IHS Markit.

The following table provides revenue and segment operating profit information for the periods ended June 30:

(in millions) Three Months Six Months

The following table provides revenue and segment operating profit information for the periods ended September 30:

(in millions) Three Months Nine Months

2023 2022 % Change 2023 2022 % Change

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Operating margin % 21 % 26 % 19 % 21 %

1 Operating profit for the three and six months ended June 30, 2023 includes employee severance charges of $3 million and $4 million, respectively, and acquisition-related costs of $1 million.

Operating profit for the six months ended June 30, 2023 includes IHS Markit merger costs of $1 million.

Operating profit for the three and six months ended June 30, 2022 includes acquisition-related costs of $3 million and $4 million, respectively, employee severance charges of $2 million and IHS Markit merger costs of $1 million.

Additionally, operating profit includes amortization of intangibles from acquisitions of $76 million and $77 million for the three months ended June 30, 2023 and 2022, respectively, and $150 million and $101 million for the six months ended June 30, 2023 and 2022, respectively.

1 Operating profit for the three and nine months ended September 30, 2023 includes employee severance charges of $3 million and $6 million, respectively, IHS Markit merger costs of $1 million and $2 million, respectively, and acquisition-related costs of $1 million and $2 million, respectively.

Operating profit for the three and nine months ended September 30, 2022 includes an acquisition-related benefit of $19 million and $15 million, respectively, and employee severance charges of $1 million and $3 million, respectively.

Operating profit for the nine months ended September 30, 2022 includes IHS Markit merger costs of $1 million.

Additionally, operating profit includes amortization of intangibles from acquisitions of $76 million for the three months ended September 30, 2023 and 2022, and $226 million and $176 million for the nine months ended September 30, 2023 and 2022, respectively.

Revenue increased 10% primarily due to price increases and new business growth within the Dealer business as well as the favorable impact of the acquisition of Market Scan in February of 2023.

Increases within the Financial business due to strong underwriting volumes and the Manufacturing business due to strong recall activity also contributed to revenue growth.

Increases within the Financial business due to strong underwriting volumes and the Manufacturing business due to strong recall activity and uptick in marketing solutions also contributed to revenue growth.

Foreign exchange rates had a favorable impact of less than 1 percentage point.

Operating profit decreased 10%.

Excluding the impact of an acquisition-related benefit in 2022 of 18 percentage points and higher employee severance charges in 2023 of 2 percentage points, operating profit increased 10% driven by revenue growth, partially offset by higher compensation costs, increased incentives, higher technology costs and expenses associated with the acquisition of Market Scan.

Foreign exchange rates had an unfavorable impact of 4 percentage points.

Revenue increased 39% primarily due to the impact of the merger with IHS Markit, price increases and new business growth within the Dealer business as well as the favorable impact of the acquisition of Market Scan in February of 2023.

Foreign exchange rates had an unfavorable impact of 1 percentage point.

Operating profit increased 29%.

Excluding the impact of higher acquisition-related costs in 2022 of 13 percentage points, higher amortization of intangibles in 2022 of 4 percentage points and higher IHS Markit merger costs in 2022 of 1 percentage points, partially offset by higher employee severance charges in 2023 of 5 percentage points, operating profit increased 5% driven by revenue growth, partially offset by increased incentives, higher compensation costs and expenses associated with the acquisition of Market Scan.

Revenue and operating profit increased primarily due to the impact of the merger with IHS Markit.

The Mobility business was acquired in connection with the merger with IHS Markit on February 28, 2022 and financial results are included since the date of acquisition.

Excluding the impact of higher amortization of intangibles from acquisitions in 2023 of 5 percentage points and an acquisition-related benefit in 2022 of 2 percentage points, operating profit increased 36% driven by revenue growth, partially offset by the impact of the merger with IHS Markit, higher compensation costs, increased incentives, higher technology costs and expenses associated with the acquisition of Market Scan.

Foreign exchange rates had an unfavorable impact of 3 percentage points.

For a further discussion of competitive and other risks inherent in our Mobility business, see Item 1A, Risk Factors in this Form 10-Q and our most recently filed Annual Report on Form 10-K.

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Indices’ mission is to provide transparent benchmarks to help with decision making, collaborate with the financial community to create innovative products, and provide investors with tools to monitor world markets.

During the three and six months ended June 30, 2022, we recorded a pre-tax gain of $38 million ($31 million after-tax) in Loss (gain) on dispositions in the consolidated statements of income for the sale of a family of leveraged loan indices, within our Indices segment, to Morningstar.

During the three and nine months ended September 30, 2022, we recorded a pre-tax gain of $14 million ($12 million after-tax) and of $52 million ($43 million after-tax) in Loss (gain) on dispositions in the consolidated statements of income for the sale of a family of leveraged loan indices, within our Indices segment, to Morningstar.

Indices derives revenue from asset-linked fees when investors direct funds into its proprietary designed or owned indexes, sales usage-based royalties of its indices, as well as data subscription arrangements.

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See Note 2 - Acquisitions and Divestitures to the consolidated financial statements of this Form 10-Q for information on the merger with IHS Markit.

The following table provides revenue and segment operating profit information for the periods June 30:

(in millions) Three Months Six Months

The following table provides revenue and segment operating profit information for the periods September 30:

(in millions) Three Months Nine Months

2023 2022 % Change 2023 2022 % Change

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Net operating margin % 48 % 52 % 49 % 54 %

1 Operating profit for the three and six months ended June 30, 2023 includes employee severance charges of $2 million and $3 million, respectively, and IHS Markit merger costs of $1 million and $2 million, respectively.

Operating profit for the six months ended June 30, 2023 includes a gain on disposition of $4 million.

Operating profit for the three and six months ended June 30, 2022 includes a gain on disposition of $38 million, employee severance charges of $2 million and $4 million, respectively, and IHS Markit merger costs of $1 million.

Additionally, operating profit includes amortization of intangibles from acquisitions of $9 million for the three months ended June 30, 2023 and 2022 and $18 million and $13 million for the six months ended June 30, 2023 and 2022, respectively.

Revenue at Indices increased 2% primarily due to higher exchange-traded derivative revenue driven by continued strength in average trading volume and higher data subscription revenue, partially offset by lower asset-linked fees revenue driven by product mix.

Ending average levels of assets under management (“AUM”) for ETFs increased 19% to $2.929 trillion compared to June 30, 2022 and average levels of AUM for ETFs increased 5% to $2.771 trillion compared to the three months ended June 30, 2022.

Foreign exchange rates had an unfavorable impact of less than 1 percentage point.

Operating profit decreased 16%.

Excluding the impact of a gain on dispositions in 2022 of 14 percentage points, operating profit decreased 2% driven by an increase in strategic investments, higher compensation costs and increased incentives, partially offset by revenue growth.

1 Operating profit for the three and nine months ended September 30, 2023 includes employee severance charges of $1 million and $4 million, respectively, and IHS Markit merger costs of $1 million and $3 million, respectively.

Operating profit for the nine months ended September 30, 2023 includes a gain on disposition of $4 million.

Operating profit for the three and nine months ended September 30, 2022 includes a gain on disposition of $14 million and $52 million, respectively, employee severance charges of $1 million and $4 million, respectively, and IHS Markit merger costs of $1 million.

Additionally, operating profit includes amortization of intangibles from acquisitions of $9 million for the three months ended September 30, 2023 and 2022, and $27 million and $22 million for the nine months ended September 30, 2023 and 2022, respectively.

Revenue at Indices increased 6% primarily due to higher exchange-traded derivative revenue driven by continued strength in average trading volume and higher asset-linked fees revenue.

Asset-linked fees revenue increased due to higher levels of assets under management (“AUM”) for ETFs, partially offset by product mix.

Ending AUM for ETFs increased 21% to $2.848 trillion compared to September 30, 2022 and average levels of AUM for ETFs increased 14% to $2.955 trillion compared to the three months ended September 30, 2022.

Foreign exchange rates had a favorable impact of less than 1 percentage point.

Revenue at Indices increased 4% primarily due to higher exchange-traded derivative revenue driven by continued strength in average trading volume, higher data subscription revenue and the impact of the merger with IHS Markit, partially offset by lower asset-linked fees revenue driven by product mix.

Operating profit decreased 2%.

Excluding the impact of a gain on dispositions in 2022 of 7 percentage points, operating profit increased 5% due to revenue growth partially offset by increased incentives and strategic investments.

Foreign exchange rates had a favorable impact of 1 percentage point.

Revenue at Indices increased 5% primarily due to higher exchange-traded derivative revenue driven by continued strength in average trading volume and higher data subscription revenue.

Foreign exchange rates had an unfavorable impact of less than 1 percentage point.

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Excluding the impact of a higher gain on dispositions in 2022 of 7 percentage points and higher amortization of intangibles from acquisitions in 2023 of 1 percentage point, operating profit increased 3%.

The impact of revenue growth was partially offset by an increase in strategic investments, higher compensation costs, increased incentives and the impact of the merger with IHS Markit.

The impact of revenue growth was partially offset by increased incentives and strategic investments.

Foreign exchange rates had a favorable impact of less than 1 percentage point.

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Engineering Solutions

Engineering Solutions is a leading provider of engineering standards and related technical knowledge.

Engineering Solutions includes our Product Design offerings that provide technical professionals with the information and insight required to more effectively design products, optimize engineering projects and outcomes, solve technical problems and address complex supply chain issues.

Our offerings utilize advanced knowledge discovery technologies, research tools, and software-based engineering decision engines to advance innovation, maximize productivity, improve quality and reduce risk.

Engineering Solutions' revenue is generated primarily through the following sources:

As of May 2, 2023, we completed the sale of Engineering Solutions, a leading provider of engineering standards and related technical knowledge, and the results are included through that date.

See Note 2 - Acquisitions and Divestitures to the consolidated financial statements of this Form 10-Q for information on the sale of Engineering Solutions and the merger with IHS Markit.

Engineering Solutions included our Product Design offerings that provided technical professionals with the information and insight required to more effectively design products, optimize engineering projects and outcomes, solve technical problems and address complex supply chain issues.

Our offerings utilized advanced knowledge discovery technologies, research tools, and software-based engineering decision engines to advance innovation, maximize productivity, improve quality and reduce risk.

Engineering Solutions' revenue was generated primarily through the following sources:

• Subscription revenue — primarily from subscriptions to our Product Design offerings providing standards, codes and specifications;

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• Non-subscription revenue — primarily from retail transaction and consulting services.

As of May 2, 2023, we completed the sale of Engineering Solutions and the results are included through that date.

See Note 2 - Acquisitions and Divestitures to the consolidated financial statements of this Form 10-Q for information on the sale of Engineering Solutions and the merger with IHS Markit.

The following table provides revenue and segment operating profit information for the periods ended June 30:

(in millions) Three Months Six Months

The following table provides revenue and segment operating profit information for the periods ended September 30:

(in millions) Three Months Nine Months

2023 2022 % Change 2023 2022 % Change

Revenue $ 33 $ 96 (65)% $ 133 $ 129 3%

Subscription revenue $ 31 $ 89 (65)% $ 125 $ 119 5%

Non-subscription revenue $ 2 $ 7 (77)% $ 8 $ 10 (21)%

Revenue $ — $ 95 N/M $ 133 $ 224 (41)%

Subscription revenue $ — $ 89 N/M $ 125 $ 208 (40)%

Non-subscription revenue $ — $ 6 N/M $ 8 $ 16 (51)%

% of total revenue:

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Non-subscription revenue — % 6 % 6 % 7 %

revenue $ 18 $ 53 (66)% $ 72 $ 71 1%

International revenue $ 15 $ 43 (65)% $ 61 $ 58 6%

revenue $ — $ 53 N/M $ 72 $ 124 (42)%

International revenue $ — $ 42 N/M $ 61 $ 100 (39)%

% of total revenue:

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N/M - Represents a change equal to or in excess of 100% or not meaningful

1 Operating profit for the three and six months ended June 30, 2022 includes employee severance charges of $1 million and $2 million, respectively.

Additionally, operating profit includes amortization of intangibles from acquisitions of $15 million for the three months ended June 30, 2022 and $1 million and $19 million for the six months ended June 30, 2023 and 2022, respectively.

1 Operating profit for the three and nine months ended September 30, 2022 includes employee severance charges of $2 million and $4 million, respectively.

Additionally, operating profit includes amortization of intangibles from acquisitions of $14 million for the three months ended September 30, 2022 and $1 million and $33 million for the nine months ended September 30, 2023 and 2022, respectively.

Revenue and operating profit decreased as a result of the sale of Engineering Solutions.

As of May 2, 2023, we completed the sale of Engineering Solutions and the results are included through that date.

Revenue and operating profit increased primarily due to the impact of the merger with IHS Markit.

Revenue decreased as a result of the sale of Engineering Solutions.

Operating profit increased primarily due to the impact of higher amortization of intangibles from acquisitions for the nine months ended September 30, 2022.

The Engineering Solutions business was acquired in connection with the merger with IHS Markit on February 28, 2022 and the financial results are included since the date of acquisition through May 2, 2023.

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Cash Flow Overview

Cash, cash equivalents, and restricted cash were $1,562 million as of June 30, 2023, an increase of $275 million from December 31, 2022.

The following table provides cash flow information for the six months ended June 30:

Cash, cash equivalents, and restricted cash were $1,646 million as of September 30, 2023, an increase of $359 million from December 31, 2022.

The following table provides cash flow information for the nine months ended September 30:

(in millions) 2023 2022 % Change

Net cash provided by (used for):

Operating activities $ 1,363 $ 676 N/M

Operating activities $ 2,376 $ 1,490 60%

Investing activities $ 607 $ 3,689 (84)%

Financing activities $ (2,602) $ (10,128) (74)%

In the first six months of 2023, free cash flow increased $654 million to $1,164 million compared to $510 million in the first six months of 2022.

In the first nine months of 2023, free cash flow increased $838 million to $2,070 million compared to $1,232 million in the first nine months of 2022.

The increase is primarily due to an increase in cash provided by operating activities as discussed below.

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Operating activities

Cash provided by operating activities increased $687 million to $1,363 million for the first six months of 2023.

Cash provided by operating activities increased $886 million to $2,376 million for the first nine months of 2023.

The increase is mainly due to higher operating results in 2023, higher IHS Markit merger costs in 2022 and a grant payment to the S&P Global Foundation in 2022.

For the first six months of 2023, our cash taxes were adversely impacted by the requirement to capitalize and amortize research and development expenses under Internal Revenue Code Section 174.

For the first nine months of 2023, our cash taxes were adversely impacted by the requirement to capitalize and amortize research and development expenses under Internal Revenue Code Section 174.

If legislation is not passed to defer, repeal, or otherwise modify the capitalization and amortization requirement we expect our cash taxes to be greater than in the prior year.

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Our cash outflows from investing activities are primarily for acquisitions and capital expenditures, while cash inflows are primarily proceeds from dispositions.

Cash provided by investing activities decreased to $656 million for the first six months of 2023 compared to $3,745 million in the first six months of 2022, primarily due to higher cash proceeds received from dispositions in 2022 related to the dispositions of CUSIP Global Services, Oil Price Information Services, the Leveraged Commentary and Data business and a related family of leveraged loan indices, and the Base Chemicals business.

Cash provided by investing activities decreased to $607 million for the first nine months of 2023 compared to $3,689 million in the first nine months of 2022, primarily due to higher cash proceeds received from dispositions in 2022 related to the dispositions of CUSIP Global Services, Oil Price Information Services, the Leveraged Commentary and Data business and a related family of leveraged loan indices, and the Base Chemicals business.

See Note 2 — Acquisitions and Divestitures to the consolidated financial statements of this Form 10-Q for further discussion.

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Our cash outflows from financing activities consist primarily of share repurchases, dividends to shareholders and repayments of short-term and long-term debt, while cash inflows are primarily attributable to the borrowing of short-term and long-term debt and proceeds from the exercise of stock options.

Cash used for financing activities decreased $5,521 million to $1,747 million for the first six months of 2023.

Cash used for financing activities decreased $7,526 million to $2,602 million for the first nine months of 2023.

The decrease is primarily attributable to a decrease in cash used for share repurchases in 2023.

During the six months ended June 30, 2023, we purchased a total of 3.9 million shares for $1.5 billion of cash.

During the six months ended June 30, 2022, we purchased a total of 19.0 million shares for $8.5 billion of cash.

During the nine months ended September 30, 2023, we purchased a total of 5.4 million shares for $2 billion of cash.

During the nine months ended September 30, 2022, we purchased a total of 29.5 million shares for $11 billion of cash.

See Note 8 — Equity to the consolidated financial statements of this Form 10-Q for further discussion.

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We have the ability to borrow a total of $2.0 billion through our commercial paper program, which is supported by our $2.0 billion five-year credit agreement (our “credit facility”) that will terminate on April 26, 2026.

As of June 30, 2023 and December 31, 2022, respectively, there was $740 million and $188 million of commercial paper outstanding.

As of September 30, 2023, we had no outstanding commercial paper.

As of December 31, 2022, there was $188 million of commercial paper outstanding.

Commitment fees for the unutilized commitments under the credit facility and applicable margins for borrowings thereunder are linked to the Company achieving three environmental sustainability performance indicators related to emissions, tested annually.

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and are fully and unconditionally guaranteed by Standard & Poor's Financial Services LLC, a 100% owned subsidiary of the Company.

Issuance of all senior notes described below have been registered with the SEC.

• On August 13, 2020, we issued $600 million of 1.25% senior notes due in 2030 and $700 million of 2.3% senior notes due in 2060.

• On November 26, 2019, we issued $500 million of 2.5% senior notes due in 2029 and $600 million of 3.25% senior notes due in 2049.

• On May 17, 2018, we issued $500 million of 4.5% senior notes due in 2048.

• On September 12, 2023, we issued $750 million of 5.25% senior notes due in 2033.

• On May 26, 2015, we issued $700 million of 4.0% senior notes due in 2025.

• On November 2, 2007 we issued $400 million of 6.55% Senior Notes due 2037.

• On March 1, 2023, S&P Global Inc.

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• $500 million of 3.90% Senior Notes due 2062 that were originally issued on March 18, 2022.

• On August 13, 2020, we issued $600 million of 1.25% senior notes due in 2030 and $700 million of 2.3% senior notes due in 2060.

• On November 26, 2019, we issued $500 million of 2.5% senior notes due in 2029 and $600 million of 3.25% senior notes due in 2049.

• On May 17, 2018, we issued $500 million of 4.5% senior notes due in 2048.

• On September 22, 2016, we issued $500 million of 2.95% senior notes due in 2027.

• On May 26, 2015, we issued $700 million of 4.0% senior notes due in 2025.

• On November 2, 2007 we issued $400 million of 6.55% Senior Notes due 2037.

The notes above are unsecured and unsubordinated and rank equally and ratably with all of our existing and future unsecured and unsubordinated debt.

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This information is not intended to present the financial position or results of operations of the Obligor Group in accordance with U.S.

Summarized results of operations for the periods ended June 30, 2023 are as follows:

(in millions) Three Months Six Months

Summarized results of operations for the periods ended September 30, 2023 are as follows:

(in millions) Three Months Nine Months

Revenue $ 764 $ 2,293

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Net income attributable to S&P Global Inc.

Summarized balance sheet information as of June 30, 2023 and December 31, 2022 is as follows:

(in millions) June 30, December 31,

Summarized balance sheet information as of September 30, 2023 and December 31, 2022 is as follows:

(in millions) September 30, December 31,

Current assets (excluding intercompany from Non-Obligor Group) $ 1,306 $ 699

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Free cash flow, as we calculate it, may not be comparable to similarly titled measures employed by other companies.

The following table presents a reconciliation of our cash flow provided by operating activities to free cash flow for the six months ended June 30:

The following table presents a reconciliation of our cash flow provided by operating activities to free cash flow for the nine months ended September 30:

(in millions) 2023 2022 % Change

Cash provided by operating activities $ 1,363 $ 676 N/M

Cash provided by operating activities $ 2,376 $ 1,490 60%

Capital expenditures (95) (61)

Distributions to noncontrolling interest holders (211) (197)

Free cash flow $ 1,164 $ 510 N/M

Free cash flow $ 2,070 $ 1,232 68%

(in millions) 2023 2022 % Change

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis