Morningstar Inc.

Company Overview

Business Model: Morningstar, Inc. is a global provider of independent investment insights, leveraging its core competencies in data, research, design, and technology. The company delivers connected data, independent research, investor-first tools, and long-term portfolio strategies to a wide range of market participants. Revenue is primarily generated through license-based subscription services (70.3% of 2025 consolidated revenue), asset-based fees for assets under management and advisement (14.0%), and transaction-based services (15.7%).

Market Position: Morningstar, Inc. positions itself as one of the few companies capable of delivering a comprehensive suite of research, ratings, data, software products, indexes, and investment management services aligned with its mission to empower investor success. The company holds a leading position in various segments, with Morningstar DBRS recognized as one of the top four credit rating agencies worldwide. Key competitive factors include brand and reputation, data accuracy and quality, technology, breadth of data coverage, quality of investment and credit research and analytics, design, product reliability, and value.

Recent Strategic Developments:

• AI Integration: Significant focus on becoming "AI-native," with AI-ready access to data, research, and capabilities through Model Context Protocol (MCP) and intelligent agents. Launched AI Insights API, Morningstar MCP server, and integrations with Anthropic’s Claude for Financial Services, Microsoft Foundry and Copilot Studio, and OpenAI’s ChatGPT.
• Acquisitions: Acquired Lumonic Inc. in March 2025 to expand PitchBook’s private credit capabilities and Dealview Technologies Limited (DealX) in March 2025 to enhance Morningstar Credit Analytics' structured finance data. Subsequent to year-end, completed the acquisition of the Center for Research in Security Prices, LLC (CRSP) in February 2026 for approximately $365.0 million to enhance index and data capabilities.
• Product Enhancements: Expanded browser access and AI-powered capabilities for Morningstar Direct, launched Direct Advisory Suite for advisors, and introduced new product innovations in private markets and thematic research for Morningstar Indexes.
• Market Expansion: Morningstar DBRS entered the APAC market with an office in Sydney, Australia, in October 2025.
• Divestitures/Retirements: Announced plans to retire Morningstar Office by early 2026 and completed the retirement of the US Morningstar Wealth Turnkey Asset Management Platform (TAMP) following a 2024 sale. Plans to retire Morningstar Sustainalytics' second-party opinions product by end of Q1 2026.

Geographic Footprint: Morningstar, Inc. operates through wholly-owned subsidiaries in 32 countries. In 2025, approximately 72% of consolidated revenue was generated from the United States, with the remaining 28% from international operations. Key international markets by revenue include Continental Europe, the United Kingdom, and Canada. The company has a significant employee presence in India (43%) and the US (29%), with other operations across the Americas, EMEA, and APAC regions.

Financial Performance

Revenue Analysis

Profitability Metrics (2025):

• Gross Margin: 61.0%
• Operating Margin: 21.5%
• Net Margin: 15.3%

Investment in Growth (2025):

• R&D Expenditure (Capitalized Software Development Costs): $98.0 million (4.0% of revenue)
• Capital Expenditures: $147.1 million
• Strategic Investments:
  • Acquisition of Lumonic Inc.: $21.3 million goodwill, $10.6 million acquired intangible assets.
  • Acquisition of Dealview Technologies Limited: $9.7 million goodwill, $13.1 million acquired intangible assets.

Business Segment Analysis

Morningstar Direct Platform

Financial Performance (2025):

• Revenue: $830.6 million (+5.4% YoY, +5.7% organic)
• Adjusted Operating Income: $369.4 million (+3.9% YoY)
• Adjusted Operating Margin: 44.5%
• Key Growth Drivers: Strong demand for Morningstar Direct and Morningstar Data, expansion with existing clients, new use cases, increased revenue per license.

Product Portfolio:

• Morningstar Data: Licenses and delivers Morningstar’s data, research, and analytics, including managed investment data, Morningstar Essentials, exchange market data, equity data, Direct Web Services, and research distribution.
• Morningstar Direct: Investment analysis and reporting application for market research, product positioning, competitive analysis, and distribution strategies.
• Morningstar Advisor Workstation: Connected suite of tools for proposal creation, investment research, and planning.

New Product Launches or Major Updates:

• Introduced AI Insights API and Morningstar Model Context Protocol (MCP) server, with integrations into Anthropic’s Claude for Financial Services, Microsoft Foundry and Copilot Studio, and OpenAI’s ChatGPT.
• Expanded Morningstar Direct access via browser and introduced AI-powered capabilities such as personalized investment insights and Python code generation.
• Launched Direct Advisory Suite in January 2025 with a modern interface and AI-assisted workflows like Intelligent Import and natural language screening.

Market Dynamics:

• Primary markets are North America and Europe.
• Competes with FE fundinfo, LSEG (Refinitiv), Bloomberg, FactSet, S&P Global, eVestment Alliance, CapIntel, Kwanti, Nitrogen, YCharts, and in-house tools from broker/dealers and custodians.
• Annual revenue renewal rate for Morningstar Data was 101% in 2025 (99% in 2024).
• Annual revenue renewal rate for Morningstar Direct was 104% in 2025 (106% in 2024), with a decline driven by license consolidation.
• Annual revenue renewal rate for Morningstar Advisor Workstation was not available in 2025 due to billing system updates and product transition.

PitchBook

Financial Performance (2025):

• Revenue: $671.8 million (+8.6% YoY, +8.5% organic)
• Adjusted Operating Income: $210.1 million (+12.7% YoY)
• Adjusted Operating Margin: 31.3%
• Key Growth Drivers: Growth in the PitchBook platform, contributions from the direct data business, and strength in core investor and advisor client segments. Partially offset by softness in the corporate client segment.

Product Portfolio:

• Comprehensive, timely data coverage across private and public companies, investors, funds, deals, loans, and executives.
• Integrated research on private equity, venture capital, credit, M&A, and managed vehicles, including Morningstar’s public equity research.
• Analytical and workflow tools such as advanced search, market intelligence dashboards, benchmarking, fund performance analytics, and portfolio monitoring.
• Software extensions and integrations, including mobile applications, CRM integrations, and Excel/PowerPoint plug-ins.
• Proprietary methodologies and machine learning models, including VC Exit Predictor and Valuation Estimates.

New Product Launches or Major Updates:

• Expanded private credit capabilities through the acquisition of Lumonic Inc. in March 2025.
• Enhanced user experience and operational efficiency through AI, including AI-powered data collection and embedding AI in workflows (PitchBook Navigator, Profile and Investor Summaries, Transcript Summaries, VC Exit Predictor, Valuation Estimates).
• Broadened access to data and intellectual property through integrations with enterprise AI applications and large language model (LLM) providers like Anthropic, OpenAI, Hebbia, and Rogo.

Market Dynamics:

• Largest markets are North America and Europe, with growing adoption in the Asia-Pacific region.
• Competes with providers of private market data, research, and workflow tools, including Beauhurst, FactSet, MSCI, Preqin (a division of BlackRock), Refinitiv, and S&P Global Market Intelligence.
• Annual revenue renewal rate for PitchBook platform and direct data products combined was 103% in 2025 (108% in 2024), reflecting softness in the corporate client segment.

Morningstar Credit

Financial Performance (2025):

• Revenue: $354.4 million (+21.7% YoY, +20.9% organic)
• Adjusted Operating Income: $114.8 million (+51.9% YoY)
• Adjusted Operating Margin: 32.4%
• Key Growth Drivers: Healthy issuance market, with particular strength in US commercial mortgage- and asset-backed securities ratings revenue and Canadian and European corporate ratings revenue.

Product Portfolio:

• Morningstar DBRS: Provides independent credit ratings on financial institutions, corporates, sovereigns, and various structured finance instruments.
• Morningstar Credit Analytics (MCA): Offers data products derived from ratings activities and analytical tools, including ratings data feeds.

New Product Launches or Major Updates:

• MCA completed the acquisition of Dealview Technologies Limited (DealX) in March 2025, enhancing analytics in the structured finance sector.
• Morningstar DBRS entered the APAC market with an office in Sydney, Australia, in October 2025.

Market Dynamics:

• Largest markets by revenue are the US, followed by Canada and EMEA.
• The global ratings market totaled approximately $11.8 billion for the trailing 12 months ended September 30, 2025.
• Competitors include Fitch Ratings, Kroll Bond Rating, Moody’s Ratings, and S&P Global Ratings.

Morningstar Wealth

Financial Performance (2025):

• Revenue: $251.4 million (+1.2% YoY, +7.8% organic)
• Adjusted Operating Income: $9.6 million (vs. -$9.3 million in 2024)
• Adjusted Operating Margin: 3.8%
• Key Growth Drivers: Growth in Investment Management and increased advertising sales.

Product Portfolio:

• Investment Management: Includes Morningstar Model Portfolios and the International Wealth Platform, offering professionally managed investment products and platform capabilities for advisors.
• Morningstar.com: Primary media site providing independent news, analysis, and educational content.
• Morningstar Investor: Offers research and tools for self-directed investors.

AUMA & Net Flows (2025):

• Investment Management AUMA: $72.8 billion (+16.9% YoY).
• Net flows across Investment Management (including Morningstar Model Portfolios and International Wealth Platform) were approximately $2.0 billion.
• Morningstar Investor paid members: 96,791 in the US, plus 8,135 across other global markets.

Strategic Developments:

• Announced plans to retire Morningstar Office, with client transition expected to complete in early 2026.
• Completed the retirement of the US Morningstar Wealth Turnkey Asset Management Platform (TAMP) following the sale of customer assets to AssetMark, Inc. in 2024.

Market Dynamics:

• Core markets are the US, Australia, UK, and South Africa.
• Competitors vary by product and geography, including BlackRock, Capital Group, Clark Capital, Brooks Macdonald, LGT Wealth Management, Tatton, Elston, Lonsec, Russell, abrdn, Aviva, Nucleus, Parmenion, in-house research teams, E*Trade, Fidelity, and Schwab.

Morningstar Retirement

Financial Performance (2025):

• Revenue: $137.6 million (+8.3% YoY, +8.3% organic)
• Adjusted Operating Income: $67.7 million (+3.2% YoY)
• Adjusted Operating Margin: 49.2%
• Key Growth Drivers: Market gains and positive net flows, supported by strong growth in traditional and Advisor Managed Accounts, fiduciary services, and custom models.

Product Portfolio:

• Managed Retirement Accounts (MRA): Includes Retirement Manager (branded), white-labeled, and advisor managed accounts, providing personalized investment and savings advice for retirement plan participants.
• Fiduciary Services: Helps plan sponsors and advisors deliver high-quality retirement plan lineups.
• Custom Models: Designs scalable solutions for recordkeepers and large plan sponsors.

AUMA & Participants (2025):

• Morningstar Retirement AUMA: $305.2 billion (+10.6% YoY).
• Served 95 retirement service providers, broker dealers, asset managers, plan sponsors, and RIAs, representing approximately 298,000 plans and 2.3 million managed accounts participants.
• Added around 290 retirement plans and 17,000 participants across its advisor managed accounts network.

Market Dynamics:

• Main geographical focus is the US retirement market.
• Competitors include Edelman Financial Engines, Fidelity, SMART (for managed accounts), Envestnet, Leafhouse, Mesirow Financial, Wilshire (for fiduciary services), and retirement plan consulting firms (for custom models).

Corporate and All Other (includes Morningstar Sustainalytics and Morningstar Indexes)

Financial Performance (2025):

• Total Revenue: $199.7 million (-1.1% YoY)
• Morningstar Sustainalytics Revenue: $112.0 million (-4.5% YoY, -7.1% organic)
• Morningstar Indexes Revenue: $87.7 million (+3.5% YoY, +3.4% organic)

Morningstar Sustainalytics:

• Product Portfolio: Provides environmental, social, and governance (ESG) data, research, and ratings, including ESG Risk Ratings and Low Carbon Transition Ratings (LCTR).
• New Product Launches or Major Updates: Expanded climate data and introduced an "enhanced controversies" solution. Plans to retire its second-party opinions product by the end of Q1 2026.
• Market Dynamics: Largest markets are EMEA and North America. Competitors include ISS STOXX, MSCI, and S&P Global. Annual revenue renewal rate for license-based products was 93% in both 2024 and 2025.

Morningstar Indexes:

• Product Portfolio: Offers a broad range of market indexes for performance benchmarks and investment products across equity, fixed income, multi-asset, private markets, and sustainability.
• New Product Launches or Major Updates: Introduced several new product innovations in private markets and thematic research. Subsequent to year-end, completed the acquisition of CRSP in February 2026.
• AUMA linked to Morningstar Indexes: $252.3 billion (+19.6% YoY).
• Market Dynamics: Largest markets are North America and EMEA. Competitors include Bloomberg Indices, FTSE Russell, MSCI, and S&P Dow Jones Indices.

Capital Allocation Strategy

Shareholder Returns (2025):

• Share Repurchases: $787.0 million (3,276,578 shares). This includes $487.0 million under the prior $500.0 million program (completed) and $300.0 million under the new $1.0 billion program.
• Dividend Payments: $76.9 million.
• Future Capital Return Commitments: $700.0 million available for future repurchases under the new share repurchase program (expires October 30, 2028). Expects to pay a regular quarterly dividend of $0.50 per share in 2026.

Balance Sheet Position (as of December 31, 2025):

• Cash and Equivalents: $474.5 million
• Total Debt: $1,072.6 million
• Net Cash Position: -$598.1 million (Net Debt)
• Debt Maturity Profile: $375.0 million due in 2028, $700.0 million due in 2030. No amounts classified as current maturities of long-term debt.

Cash Flow Generation (2025):

• Operating Cash Flow: $589.7 million (-0.3% YoY)
• Free Cash Flow: $442.6 million (-1.4% YoY)
• Cash Conversion Metrics: Cash provided by operating activities decreased primarily due to higher income tax and bonus tax payments, largely offset by higher cash earnings. Capital expenditures increased due to investment in product development.

Operational Excellence

Production & Service Model: Morningstar, Inc.'s operational philosophy is centered on its core competencies of data, research, design, and technology. The company builds products on the depth and breadth of its data, designed to clearly convey complex investment information. It generally manages its own websites and builds its own software to control technology development, manage costs, and respond quickly to market and customer needs.

Supply Chain Architecture: Key Suppliers & Partners:

• Data & Research Providers: Securities exchanges, fund companies, issuers, and other third-party data providers.
• Technology Partners: Third-party AI product engines and open-source software components. Strategic collaborations with enterprise AI providers like Anthropic, OpenAI, Microsoft Foundry and Copilot Studio, Hebbia, and Rogo.
• Service Providers: Third-party vendors for contract labor, Software as a Service (SaaS), and data backup facilities.

Facility Network (as of December 31, 2025):

• Manufacturing/Operations: Leases approximately 497,000 square feet of office space for US operations, with about half for its corporate headquarters in Chicago, Illinois.
• Global Presence: Leases approximately 796,000 square feet of office space in 20 other countries, including approximately 456,000 square feet in Mumbai, India, and approximately 82,000 square feet in Toronto, Canada.
• Research & Development: R&D initiatives include integrating AI and related technologies into internal processes and products.

Operational Metrics:

• Capitalized software depreciation expense: $102.7 million (2025).
• Capitalized software development costs: $98.0 million (2025).

Market Access & Customer Relationships

Go-to-Market Strategy: Morningstar, Inc. leverages its differentiated data and research to sell products and services through three primary revenue models:

• License-based: Majority of research, data, and proprietary platforms accessed via subscription services (per user or enterprise-basis) for specified periods, typically one to three years.
• Asset-based: Basis points and other fees charged for assets under management or advisement (AUMA), with arrangements typically ranging from one to three years.
• Transaction-based: One-time revenue and recurring revenue primarily from surveillance and research in Morningstar Credit.

Distribution Channels:

• Direct Sales: Enterprise sales forces and direct customer relationships across various segments.
• Channel Partners: Alliances and redistributors, including global fintech firms.
• Digital Platforms: Morningstar.com (media site with news, analysis, educational content) and Morningstar Investor (research and tools for self-directed investors).

Customer Portfolio: Morningstar, Inc. focuses on eight primary customer groups:

• Advisors: Independent financial advisors and those affiliated with RIAs, broker/dealers, or other intermediaries.
• Alliances and Redistributors: Including global fintech firms.
• Asset Managers: Fund companies, insurance companies, and other firms managing securities portfolios.
• Fixed-income Security Issuers and Arrangers: Clients of Morningstar Credit.
• Individual Investors: Users of Morningstar.com and Morningstar Investor.
• Institutional Asset Owners and Consultants.
• Private Market Investors: Private equity and venture capital firms, asset managers, limited partners, investment banks, private credit investors, corporations, and professional service providers.
• Retirement Plan Providers, Advisors, and Sponsors.

Customer Concentration: In 2025, Morningstar, Inc.'s largest customer accounted for less than 3% of its consolidated revenue, indicating a diversified customer base.

Geographic Revenue Distribution (2025):

• United States: 72% of total revenue.
• International: 28% of total revenue.
  • United Kingdom: 7.8% of total revenue.
  • Continental Europe: 6.3% of total revenue.
  • Canada: 6.3% of total revenue.
  • Australia: 2.6% of total revenue.
  • Asia: 2.0% of total revenue.
  • Other: 0.5% of total revenue.

Competitive Intelligence

Market Structure & Dynamics

Industry Characteristics: The economic and financial information industry is characterized by a few large firms and numerous smaller, specialized companies. It is subject to rapid innovation and technological advances, particularly in financial information services and investable products. Key trends include the increasing importance of AI, growing interest in alternative assets (e.g., private market offerings), and the rise of passive investment strategies.

Competitive Positioning Matrix (2025):

Direct Competitors

Primary Competitors:

• Morningstar Direct Platform: FE fundinfo, LSEG (Refinitiv), Bloomberg, FactSet, S&P Global, eVestment Alliance, SPAR, Eikon, CapIntel, Kwanti, Nitrogen, YCharts, and in-house tools from broker/dealers and custodians.
• PitchBook: Beauhurst, FactSet, MSCI, Preqin (a division of BlackRock), Refinitiv, S&P Global Market Intelligence, and smaller specialized data providers.
• Morningstar Credit: Fitch Ratings, Kroll Bond Rating, Moody’s Ratings, and S&P Global Ratings.
• Morningstar Wealth: BlackRock, Capital Group, Clark Capital, Brooks Macdonald, LGT Wealth Management, Tatton, Elston, Lonsec, Russell, abrdn, Aviva, Nucleus, Parmenion, in-house research teams, E*Trade, Fidelity, and Schwab.
• Morningstar Retirement: Edelman Financial Engines, Fidelity, SMART, Envestnet, Leafhouse, Mesirow Financial, Wilshire, and retirement plan consulting firms.
• Morningstar Sustainalytics: ISS STOXX, MSCI, and S&P Global.
• Morningstar Indexes: Bloomberg Indices, FTSE Russell, MSCI, and S&P Dow Jones Indices.

Emerging Competitive Threats: New entrants and disruptive technologies, particularly those leveraging AI to scrape data and offer low-cost or free solutions, pose a threat to Morningstar, Inc.'s product suite.

Competitive Response Strategy: Morningstar, Inc. focuses on continuous innovation, effectively incorporating new datasets, research, AI technologies, content, and software to meet evolving customer needs. The company aims to be "AI-native" and own the language of markets, emphasizing research as its R&D engine.

Risk Assessment Framework

Strategic & Market Risks

• Market Dynamics: Vulnerability to prolonged volatility, recessions, or downturns in financial, data, and software sectors, fluctuating interest rates, and global trade policies. Asset-based revenue is sensitive to market performance, and the credit ratings business is vulnerable to fixed-income issuance levels. Increased interest in alternative assets and the rise of passive investment strategies may impact demand for certain products.
• Technology Disruption: Risk of existing products becoming less competitive or obsolete due to rapid innovation and AI advancements. Failure to effectively incorporate new technologies or adapt to evolving customer needs could harm competitive position and reputation.
• Customer Concentration: While the largest customer accounts for less than 3% of revenue, industry consolidation could reduce the client base.
• Brand & Reputation: Risk of harm from real or perceived failures in independence, transparency, or integrity, including allegations of conflicts of interest (e.g., issuer-pay model in credit ratings, "referee and player" in investment management). ESG-related products and methodologies may also attract public debate and scrutiny.

Operational & Execution Risks

• Supply Chain Vulnerabilities: Dependence on external sources for data and research, including sole-source dependencies. Reliance on third-party AI technologies and service providers introduces risks of service degradation, errors, security inadequacies, and potential termination or changes in agreements.
• Cybersecurity & Data Protection: Significant reputational, operational, and financial consequences from cybersecurity incidents, data breaches, or improper access/release of confidential information, including personal data. Complex and evolving global privacy laws (e.g., GDPR) and cross-border data transfer restrictions increase compliance obligations and costs. Acquisitions may inherit security vulnerabilities.
• Accuracy & Use of Information: Potential liability from errors in research, ratings, published data, automated advisory tools, or reliance on ingested third-party data and open-source components. Claims could arise from securities law violations, defamation, negligence, or intellectual property infringement.
• Intellectual Property: Failure to protect trademarks, copyrights, patents, and trade secrets, or claims of infringement against Morningstar, Inc., could harm brand, financial results, and competitive position.
• Human Capital: Dependence on recruiting, developing, and retaining qualified employees with specialized skills (e.g., engineering, quantitative analysis, AI expertise). Challenges include global workforce management, rising wage scales, and potential attrition from leadership changes or integration of acquired businesses.
• Acquisition & Divestiture Integration: Strategic transactions carry execution risks, including difficulties in integrating employees, cultures, operations, and technologies, as well as potential unknown liabilities or regulatory investigations.

Financial & Regulatory Risks

• Regulatory & Compliance: Extensive and evolving global laws and regulations across highly regulated businesses (credit ratings, investment management, ESG research, indexes). Noncompliance could result in fines, sanctions, and reputational harm. Increased ESG regulation (e.g., EU ESG Rating Provider Regulation) and scrutiny, as well as potential regulation of index providers as investment advisers, could significantly increase compliance costs.
• Tax Strategy: Challenges from increasing complexities in global tax accounting (e.g., OECD Pillar Two, US OBBB) could affect tax obligations and effective tax rate.
• Foreign Exchange: Fluctuations in foreign currency exchange rates impact US dollar reported value of revenues, expenses, assets, and liabilities, as Morningstar, Inc. does not currently engage in currency hedging.
• Indebtedness: Floating rate debt exposes Morningstar, Inc. to interest rate risk. Restrictive covenants in debt agreements limit financial flexibility.

Geopolitical & External Risks

• Geopolitical Exposure: Global operations expose Morningstar, Inc. to geopolitical uncertainties, trade tensions, and economic/financial sanctions, which could impact market access and revenue.
• Trade Relations: Impact of trade policies and restrictions on acquisitions and investments, particularly in technology.

Innovation & Technology Leadership

Research & Development Focus: Morningstar, Inc.'s R&D strategy is to expand and enhance existing products and services by adopting new technologies, including AI. The focus is on improving employee productivity, supporting data acquisition and analysis, and enhancing the functionality and user experience of its offerings. This includes expanded delivery of data and research to AI platforms and applications. The company generally builds its own software and manages its own websites.

Core Technology Areas:

• AI Technologies: Significant investment in AI, including internally-developed and third-party models, to simplify user access to research and data, provide generative AI summaries, and support conversational search and due diligence workflows.
• Data & Analytics Platforms: Development of proprietary desktop and web-based software platforms (e.g., Morningstar Direct, PitchBook platform) and direct data feeds/APIs.
• Proprietary Methodologies: Development of proprietary statistics and research (e.g., Morningstar Category, Style Box, Morningstar Rating, Medalist Ratings), and machine learning models (e.g., VC Exit Predictor, Manager Performance Scores, Valuation Estimates).

Intellectual Property Portfolio:

• Patent Strategy: Holds several US and foreign patents for coordinate-based document processing/data entry, portfolio management analysis, manager structure optimization, and grid-less table processing, with additional applications pending.
• Trademark Strategy: Registers its brand name and logo, and product names (e.g., Morningstar, PitchBook, DBRS, Sustainalytics) in jurisdictions with business offices or significant operations.
• Licensing Programs: Licenses products and related intellectual property to customers and operating companies globally.

Technology Partnerships:

• Strategic alliances and integrations with leading enterprise AI applications and large language model (LLM) providers, including Anthropic, OpenAI, Microsoft Foundry and Copilot Studio, Hebbia, and Rogo.
• Research collaborations are not explicitly detailed but implied through continuous innovation.

Leadership & Governance

Executive Leadership Team (as of January 1, 2026)

Leadership Continuity: The company emphasizes the continued service of its executive officers and senior leaders. Succession planning and leadership development initiatives are in place.

Board Composition: The Board of Directors delegates oversight of cybersecurity risks to the Audit Committee. The Audit Committee regularly reviews cybersecurity and data privacy practices with management.

Human Capital Strategy

Workforce Composition (as of December 31, 2025):

• Total Employees: 10,973 permanent, full-time employees.
• Geographic Distribution: India (43%), US (29%), Continental Europe (10%), Canada (7%), UK (6%), with the remainder in Australia, Asia (ex-India), and other regions.
• Skill Mix: Key offerings require specialized skills in engineering, research, quantitative analysis, fixed income data, credit analysis, and emerging strategic disciplines.

Talent Management:

• Acquisition & Retention: Global turnover remained flat at 17% in 2025. Voluntary turnover decreased to 12% (from 13% in 2024), while involuntary turnover increased to 5% (from 4% in 2024). Employee engagement score increased to 66% in 2025 (from 64% in 2024). Offers a total rewards package supporting financial, physical, emotional, and social well-being. Rolled out a peer-to-peer rewards and recognition system (over 29,000 recognitions in 2025).
• Employee Value Proposition: Enhanced educational stipend program in 2025, allowing up to 50% for wellness purposes, leading to over 85% participation.
• Diversity & Development: 52% of open roles were filled by internal candidates in 2025. Offers educational and career development programs, including the Morningstar Development Program (MDP) for recent graduates, Manager Academy, Leader Academy, and high potential programs (Emerging Leader and High Performer Programs).

Environmental & Social Impact

Environmental Commitments:

• Climate Strategy: Committed to decarbonizing 50% of Scope 1 and Scope 2 greenhouse gas emissions by 2030 and publicly disclosing emissions annually. Guided by standards such as the Task Force on Climate-Related Financial Disclosure (TCFD), the Sustainability Accounting Standards Board (SASB), and Global Reporting Initiative (GRI).
• Renewable Energy: Not explicitly detailed in the filing.

Supply Chain Sustainability:

• Supplier Engagement: Engages with suppliers on ESG requirements and responsible sourcing.

Social Impact Initiatives:

• Community Investment: Philanthropic programs and local community support are implied through the mission and values.
• Product Impact: Products are designed to empower investor success, providing transparency into investment choices and supporting informed decisions. Morningstar Sustainalytics offers ESG data and ratings to support clients' investment selection and reporting, risk management, and climate strategies.

Business Cyclicality & Seasonality

Demand Patterns: Morningstar, Inc. believes its business has minimal seasonality, as most products are sold with subscription terms of at least one year, and revenue is recognized ratably. Market movements and general market conditions have a greater influence on performance. Asset-based revenue depends on the value of assets under advisory services and assets tracking its indexes, which can fluctuate with market performance. The credit ratings business is subject to market effects on the level of fixed-income issuance.

Planning & Forecasting: The company manages its business with a long-term view and typically does not make significant adjustments to strategy or cost structure in response to short-term changes.

Regulatory Environment & Compliance

Regulatory Framework: Morningstar, Inc. is subject to extensive and evolving laws, rules, and regulations that vary by jurisdiction, particularly across its credit ratings, investment management, investment research, ESG research, ratings and data, and indexes businesses. The increasing pace and scope of global regulatory changes heighten compliance risks.

Industry-Specific Regulations:

• Morningstar Credit: Morningstar DBRS is registered and regulated as a Nationally Recognized Statistical Rating Organization (NRSRO) by the US SEC, a Designated Rating Organization (DRO) by the Ontario Securities Commission (OSC) in Canada, and regulated by the UK Financial Conduct Authority (FCA) and the European Securities and Markets Authority (ESMA). It also holds an Australian financial services license.
• Investment Management: Morningstar Investment Management LLC is registered as an investment adviser with the US SEC and as a commodity pool operator (CPO) with the US Commodity Futures Trading Commission (CFTC). It may act as an ERISA fiduciary for retirement plans. Subsidiaries in Australia, the UK, UAE, Channel Islands, and South Africa are registered and regulated by their respective local authorities (e.g., ASIC, FCA, Dubai Financial Services Authority, Jersey Financial Services Commission, South African Financial Sector Conduct Authority).
• Morningstar Sustainalytics: GES International AB is a notified proxy advisor in Sweden, and Sustainalytics UK Ltd. is on the FCA’s list of Proxy Advisors. The business is subject to pending and proposed ESG ratings and data legislation, including the EU ESG Rating Provider Regulation effective in 2026.
• Morningstar Indexes: Morningstar Indexes GmbH is registered with and regulated by the German Federal Financial Supervisory Authority (BaFin) as an EU benchmark administrator. The EU Benchmark Regulation was amended in January 2026, removing most of Morningstar Indexes' benchmarks from its scope. The US SEC is considering regulating index providers as investment advisers.

Trade & Export Controls: Morningstar, Inc. is subject to international trade restraints, including economic and financial sanction laws and embargoes administered by the US Treasury Department’s Office of Foreign Assets Controls.

Legal Proceedings: The company records accrued liabilities for litigation, regulatory, and other business matters when probable and estimable. It is involved in data audits and reviews, and its ratings and research activities are subject to regulatory scrutiny and potential investigations. No material adverse effect on business, operating results, or financial position is anticipated from current matters.

Tax Strategy & Considerations

Tax Profile: Morningstar, Inc.'s effective tax rate in 2025 was 24.5%, an increase of 2.6 percentage points from 21.9% in 2024. The 2024 rate was favorably impacted by a book gain on the sale of its Commodity and Energy Data business, offset by deferred taxes on unremitted foreign earnings.

Geographic Tax Planning: Approximately 81% of cash, cash equivalents, and investments were held by operations outside the US as of December 31, 2025. In 2025, Morningstar, Inc. completed a one-time repatriation of $150.0 million in foreign earnings to the US. The remainder of accumulated undistributed foreign earnings is generally considered indefinitely reinvested.

Tax Reform Impact: The OECD's proposed global minimum tax of 15% (Pillar Two) did not have a material impact on consolidated financial statements as of December 31, 2025. The US One Big Beautiful Bill Act (OBBB), enacted July 4, 2025, also did not have a material impact on consolidated financial statements as of December 31, 2025.

Insurance & Risk Transfer

Risk Management Framework: Morningstar, Inc. maintains voluntary and required insurance coverages, including general liability, property, director and officer, technical professional liability, media liability, network cybersecurity and privacy liability, investment advisory professional liability, fidelity bond, and worker’s compensation/employers liability. These coverages incur significant annual costs, which are expected to increase. The company has not engaged in currency hedging to date and does not currently have positions in derivative instruments to hedge currency risk.