Morningstar tops Q3 profit estimates as revenue rises 8.9%

Morningstar, Inc. (MORN) said on Oct. 28 in an 8-K filing that adjusted diluted earnings for the third quarter were $3.48 per share, topping the $3.10 consensus estimate compiled by Finnhub. Revenue of $672.1 million was in line with the $678.04 million estimate.

Adjusted diluted net income per share rose 36.5% from a year earlier. Reported diluted earnings were $3.06 per share, up 41.0%.

Here's how the company did:

• Adjusted EPS: $3.48 per share vs. $2.55 a year earlier, against the $3.10 consensus estimate compiled by Finnhub
• Revenue: $672.1 million vs. $617.4 million a year earlier, in line with the $678.04 million consensus estimate compiled by Finnhub

Revenue grew 8.9% on a reported basis and 6.8% on an organic basis. Excluding the impact of sunsetting certain products, organic revenue would have increased 7.8%.

Operating income rose 31.0% to $167.4 million. Adjusted operating income was $189.9 million, up 26.1%, and the adjusted operating margin was 28.3%, versus 24.4% a year earlier. The company said the CRSP acquisition was accretive to adjusted operating margin in the quarter.

Revenue has risen in each of the last three quarters, from $617.4 million in the third quarter of 2025 to $663.2 million in the second quarter of 2026, according to its SEC filings.

"We continue to put important product enhancements in the hands of our clients while delivering profitable growth," said Morningstar CEO Kunal Kapoor. He pointed to Direct AI, which the company launched this month and which features agentic workflows.

Segment results

Morningstar Direct Platform revenue rose 5.4% to $222.5 million, with adjusted operating income up 11.2% to $104.2 million. Morningstar Credit revenue rose 18.3% to $107.8 million, and its adjusted operating income rose 44.5% to $40.6 million.

PitchBook revenue rose 3.9% to $175.6 million, while its adjusted operating income fell 1.1% to $52.3 million. Morningstar Wealth revenue fell 4.3% to $59.4 million, and its assets under management and advisement fell 8.5% to $64.8 billion, primarily due to the loss of a client in Japan. Morningstar Retirement revenue rose 21.3% to $41.5 million.

Costs and charges

Operating expense rose 3.0% to $504.7 million. Technology infrastructure costs rose $7.1 million, largely from cloud migration and AI initiatives, and advertising and marketing rose $5.3 million, including the Game On brand campaign.

Compensation fell $7.9 million, mainly on lower bonus expense, partly offset by a $6.9 million rise in severance costs.

Cash and capital returns

Cash provided by operating activities fell 2.6% to $190.7 million, and free cash flow fell 2.9% to $155.4 million. The company repurchased 486,573 shares for $100.0 million and paid $18.7 million in dividends.

As of Sept. 30, 2026, the company had $1.7 billion of debt, compared with $1.1 billion at Dec. 31, 2025.