Cover page
Cover page - shares | 6 Months Ended | |
Jun. 30, 2023 | Jul. 21, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 000-51280 | |
Entity Registrant Name | MORNINGSTAR, INC. | |
Entity Central Index Key | 0001289419 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Title of 12(b) Security | Common stock, no par value | |
Entity Incorporation, State or Country Code | IL | |
Entity Tax Identification Number | 36-3297908 | |
Entity Address, Address Line One | 22 West Washington Street | |
Entity Address, City or Town | Chicago | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60602 | |
Trading Symbol | MORN | |
Security Exchange Name | NASDAQ | |
City Area Code | 312 | |
Local Phone Number | 696-6000 | |
Entity Current Reporting Status | Yes | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 42,653,700 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Income Statement [Abstract] | ||||
Revenue | $ 504.7 | $ 470.4 | $ 984.4 | $ 927.4 |
Operating expense: | ||||
Cost of revenue | 216.4 | 197.6 | 435.2 | 388.9 |
Sales and marketing | 109.5 | 91.8 | 217.1 | 173.2 |
General and administrative | 90.1 | 87.1 | 174.1 | 177.4 |
Depreciation and amortization | 47 | 40 | 91.8 | 77.6 |
Total operating expense | 463 | 416.5 | 918.2 | 817.1 |
Operating income | 41.7 | 53.9 | 66.2 | 110.3 |
Non-operating income (loss), net: | ||||
Interest expense, net | (14.1) | (4.4) | (27.4) | (6.8) |
Realized gain (loss) on sale of investments, reclassified from other comprehensive income | 0.3 | (3.1) | 0.5 | (2.1) |
Expense from equity method transaction, net | 0 | 0 | (11.8) | 0 |
Other income (loss), net | 3.8 | (7.1) | 6.3 | 0.9 |
Non-operating income (loss), net | (10) | (14.6) | (32.4) | (8) |
Income before income taxes and equity in investments of unconsolidated entities | 31.7 | 39.3 | 33.8 | 102.3 |
Equity in investments of unconsolidated entities | (1.8) | (1.8) | (3.1) | (1.4) |
Income tax expense | (6.2) | 7.4 | 2.2 | 24.7 |
Consolidated net income | $ 36.1 | $ 30.1 | $ 28.5 | $ 76.2 |
Net income per share: | ||||
Basic (in dollars per share) | $ 0.85 | $ 0.71 | $ 0.67 | $ 1.78 |
Diluted (in dollars per share) | 0.84 | 0.70 | 0.67 | 1.77 |
Dividends declared (in dollars per share) | 0.38 | 0.36 | 0.75 | 0.72 |
Dividends paid per common share (in dollars per share) | $ 0.38 | $ 0.36 | $ 0.75 | $ 0.72 |
Weighted average shares outstanding: | ||||
Basic (in shares) | 42.6 | 42.6 | 42.6 | 42.8 |
Diluted (in shares) | 42.8 | 42.9 | 42.8 | 43.1 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Consolidated net income | $ 36.1 | $ 30.1 | $ 28.5 | $ 76.2 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustment, net | 7.9 | (43.7) | 15 | (48.7) |
Unrealized gains (losses) on securities: | ||||
Unrealized holding gains (losses) arising during period | 0.1 | (3) | 0.2 | (7.8) |
Reclassification of realized gains (losses) on investments included in net income | (0.1) | 2.8 | (0.3) | 2.1 |
Other comprehensive income (loss), net | 7.9 | (43.9) | 14.9 | (54.4) |
Comprehensive income (loss) | $ 44 | $ (13.8) | $ 43.4 | $ 21.8 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 343.3 | $ 376.6 |
Investments | 34.9 | 38 |
Accounts receivable, less allowance for credit losses of $5.7 million and $6.6 million, respectively | 321.8 | 307.9 |
Income tax receivable | 15.1 | 0 |
Deferred commissions | 42.7 | 40.7 |
Prepaid expenses | 45.8 | 36.7 |
Other current assets | 3.7 | 10.9 |
Total current assets | 807.3 | 810.8 |
Goodwill | 1,584.7 | 1,571.7 |
Intangible assets, net | 518.5 | 548.6 |
Property, equipment, and capitalized software, less accumulated depreciation and amortization of $666.7 million and $610.7 million, respectively | 205.6 | 199.4 |
Operating lease assets | 173.6 | 191.6 |
Investments in unconsolidated entities | 114.8 | 96 |
Deferred tax asset, net | 11.5 | 10.8 |
Deferred commissions | 32.4 | 35.4 |
Other assets | 9.5 | 10.5 |
Total assets | 3,457.9 | 3,474.8 |
Current liabilities: | ||
Deferred revenue | 506.3 | 455.6 |
Accrued compensation | 169.4 | 220.1 |
Accounts payable and accrued liabilities | 69 | 76.2 |
Current portion of long-term debt | 32.1 | 32.1 |
Operating lease liabilities | 36.3 | 37.3 |
Contingent consideration liability | 0 | 50 |
Other current liabilities | 1.8 | 11.2 |
Total current liabilities | 814.9 | 882.5 |
Operating lease liabilities | 160.3 | 176.7 |
Accrued compensation | 23.2 | 20.7 |
Deferred tax liabilities, net | 58.2 | 62.9 |
Long-term debt | 1,121.4 | 1,077.5 |
Deferred revenue | 29.5 | 33.5 |
Other long-term liabilities | 14.8 | 13.9 |
Total liabilities | 2,222.3 | 2,267.7 |
Morningstar, Inc. shareholders’ equity: | ||
Common stock, no par value, 200,000,000 shares authorized, of which 42,653,561 and 42,480,051 shares were outstanding as of June 30, 2023 and December 31, 2022, respectively | 0 | 0 |
Treasury stock at cost, 11,993,210 and 11,991,517 shares as of June 30, 2023 and December 31, 2022, respectively | (986.8) | (986.7) |
Additional paid-in capital | 775 | 757.8 |
Retained earnings | 1,531.5 | 1,535 |
Accumulated other comprehensive loss: | ||
Currency translation adjustment | (84) | (99) |
Unrealized gain on available-for-sale investments | (0.1) | 0 |
Total accumulated other comprehensive loss | (84.1) | (99) |
Total equity | 1,235.6 | 1,207.1 |
Total liabilities and equity | $ 3,457.9 | $ 3,474.8 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts receivable | $ 5.7 | $ 6.6 |
Accumulated depreciation and amortization | $ 666.7 | $ 610.7 |
Common Stock, No Par Value (in dollars per share) | $ 0 | $ 0 |
Common Stock, Shares Authorized (in shares) | 200,000,000 | 200,000,000 |
Common Stock, Shares, Outstanding (in shares) | 42,653,561 | 42,480,051 |
Treasury Stock, Common, Shares | 11,993,210 | 11,991,517 |
Condensed Consolidated Statem_3
Condensed Consolidated Statement of Equity - USD ($) $ in Millions | Total | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock, Common |
Balance at Dec. 31, 2021 | $ 1,415.9 | $ 0 | $ 689 | $ 1,526.5 | $ (35.3) | $ (764.3) |
Balance (in shares) at Dec. 31, 2021 | 43,136,273 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Consolidated net income | 46.1 | 46.1 | ||||
Other comprehensive income (loss): | ||||||
Unrealized gain (loss) on available-for-sale investments, net of tax | (4.8) | (4.8) | ||||
Reclassification of realized gain on investments included in net income, net of tax | (0.7) | (0.7) | ||||
Foreign currency translation adjustment, net | (5) | (5) | ||||
Other comprehensive income (loss), net | (10.5) | (10.5) | ||||
Issuance of common stock related to vesting of stock awards, net of shares withheld for taxes on settlements of stock awards | 34,350 | |||||
Issuance of common stock related to vesting of stock awards, net of shares withheld for taxes on settlements of stock awards | (7.1) | (7.1) | ||||
Reclassification of awards previously liability-classified that were converted to equity | 19.4 | 19.4 | ||||
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | ||||||
Stock-based compensation | 13.9 | 13.9 | ||||
Common share repurchased (in shares) | (402,971) | |||||
Common shares repurchased | (110.6) | (110.6) | ||||
Dividends declared | (15.4) | (15.4) | ||||
Balance at Mar. 31, 2022 | $ 1,351.7 | $ 0 | 715.2 | 1,557.2 | (45.8) | (874.9) |
Balance (in shares) at Mar. 31, 2022 | 42,767,652 | |||||
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | ||||||
Dividends declared (in dollars per share) | $ 0.36 | |||||
Balance at Dec. 31, 2021 | $ 1,415.9 | $ 0 | 689 | 1,526.5 | (35.3) | (764.3) |
Balance (in shares) at Dec. 31, 2021 | 43,136,273 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Consolidated net income | 76.2 | |||||
Other comprehensive income (loss): | ||||||
Unrealized gain (loss) on available-for-sale investments, net of tax | (7.8) | |||||
Reclassification of realized gain on investments included in net income, net of tax | 2.1 | |||||
Foreign currency translation adjustment, net | (48.7) | |||||
Other comprehensive income (loss), net | (54.4) | |||||
Balance at Jun. 30, 2022 | $ 1,240.8 | $ 0 | 724.5 | 1,572 | (89.7) | (966) |
Balance (in shares) at Jun. 30, 2022 | 42,492,188 | |||||
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | ||||||
Dividends declared (in dollars per share) | $ 0.72 | |||||
Balance at Mar. 31, 2022 | $ 1,351.7 | $ 0 | 715.2 | 1,557.2 | (45.8) | (874.9) |
Balance (in shares) at Mar. 31, 2022 | 42,767,652 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Consolidated net income | 30.1 | 30.1 | ||||
Other comprehensive income (loss): | ||||||
Unrealized gain (loss) on available-for-sale investments, net of tax | (3) | (3) | ||||
Reclassification of realized gain on investments included in net income, net of tax | 2.8 | 2.8 | ||||
Foreign currency translation adjustment, net | (43.7) | (43.7) | ||||
Other comprehensive income (loss), net | (43.9) | (43.9) | ||||
Issuance of common stock related to vesting of stock awards, net of shares withheld for taxes on settlements of stock awards | 98,894 | |||||
Issuance of common stock related to vesting of stock awards, net of shares withheld for taxes on settlements of stock awards | (11.3) | (12.7) | 1.4 | |||
Reclassification of awards previously liability-classified that were converted to equity | (0.1) | (0.1) | ||||
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | ||||||
Stock-based compensation | 22.1 | 22.1 | ||||
Common share repurchased (in shares) | (374,358) | |||||
Common shares repurchased | (92.5) | 92.5 | ||||
Dividends declared | (15.3) | (15.3) | ||||
Balance at Jun. 30, 2022 | $ 1,240.8 | $ 0 | 724.5 | 1,572 | (89.7) | (966) |
Balance (in shares) at Jun. 30, 2022 | 42,492,188 | |||||
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | ||||||
Dividends declared (in dollars per share) | $ 0.36 | |||||
Balance at Dec. 31, 2022 | $ 1,207.1 | $ 0 | 757.8 | 1,535 | (99) | (986.7) |
Balance (in shares) at Dec. 31, 2022 | 42,480,051 | 42,480,051 | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Consolidated net income | $ (7.6) | (7.6) | ||||
Other comprehensive income (loss): | ||||||
Unrealized gain (loss) on available-for-sale investments, net of tax | 0.1 | 0.1 | ||||
Reclassification of realized gain on investments included in net income, net of tax | (0.2) | (0.2) | ||||
Foreign currency translation adjustment, net | 7.1 | 7.1 | ||||
Other comprehensive income (loss), net | 7 | 7 | ||||
Issuance of common stock related to vesting of stock awards, net of shares withheld for taxes on settlements of stock awards | 70,892 | |||||
Issuance of common stock related to vesting of stock awards, net of shares withheld for taxes on settlements of stock awards | (9.4) | (9.4) | ||||
Reclassification of awards previously liability-classified that were converted to equity | 11.4 | 11.4 | ||||
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | ||||||
Stock-based compensation | 12.2 | 12.2 | ||||
Dividends declared | (16) | (16) | ||||
Balance at Mar. 31, 2023 | $ 1,204.7 | $ 0 | 772 | 1,511.4 | (92) | (986.7) |
Balance (in shares) at Mar. 31, 2023 | 42,550,943 | |||||
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | ||||||
Dividends declared (in dollars per share) | $ 0.38 | |||||
Balance at Dec. 31, 2022 | $ 1,207.1 | $ 0 | 757.8 | 1,535 | (99) | (986.7) |
Balance (in shares) at Dec. 31, 2022 | 42,480,051 | 42,480,051 | ||||
Increase (Decrease) in Stockholders' Equity | ||||||
Consolidated net income | $ 28.5 | |||||
Other comprehensive income (loss): | ||||||
Unrealized gain (loss) on available-for-sale investments, net of tax | 0.2 | |||||
Reclassification of realized gain on investments included in net income, net of tax | (0.3) | |||||
Foreign currency translation adjustment, net | 15 | |||||
Other comprehensive income (loss), net | 14.9 | |||||
Balance at Jun. 30, 2023 | $ 1,235.6 | $ 0 | 775 | 1,531.5 | (84.1) | (986.8) |
Balance (in shares) at Jun. 30, 2023 | 42,653,561 | 42,653,561 | ||||
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | ||||||
Dividends declared (in dollars per share) | $ 0.75 | |||||
Balance at Mar. 31, 2023 | $ 1,204.7 | $ 0 | 772 | 1,511.4 | (92) | (986.7) |
Balance (in shares) at Mar. 31, 2023 | 42,550,943 | |||||
Increase (Decrease) in Stockholders' Equity | ||||||
Consolidated net income | 36.1 | 36.1 | ||||
Other comprehensive income (loss): | ||||||
Unrealized gain (loss) on available-for-sale investments, net of tax | 0.1 | 0.1 | ||||
Reclassification of realized gain on investments included in net income, net of tax | (0.1) | (0.1) | ||||
Foreign currency translation adjustment, net | 7.9 | 7.9 | ||||
Other comprehensive income (loss), net | 7.9 | 7.9 | ||||
Issuance of common stock related to vesting of stock awards, net of shares withheld for taxes on settlements of stock awards | 111,102 | |||||
Issuance of common stock related to vesting of stock awards, net of shares withheld for taxes on settlements of stock awards | (10.4) | (11.7) | 1.3 | |||
Reclassification of awards previously liability-classified that were converted to equity | (0.1) | (0.1) | ||||
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | ||||||
Stock-based compensation | 14.8 | 14.8 | ||||
Common share repurchased (in shares) | (8,484) | |||||
Common shares repurchased | (1.4) | (1.4) | ||||
Dividends declared | (16) | (16) | ||||
Balance at Jun. 30, 2023 | $ 1,235.6 | $ 0 | $ 775 | $ 1,531.5 | $ (84.1) | $ (986.8) |
Balance (in shares) at Jun. 30, 2023 | 42,653,561 | 42,653,561 | ||||
Adjustments to Additional Paid in Capital, Share-based Compensation, Requisite Service Period Recognition | ||||||
Dividends declared (in dollars per share) | $ 0.38 |
Condensed Consolidated Statem_4
Condensed Consolidated Statement of Equity (Parenthetical) - $ / shares | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Statement of Stockholders' Equity [Abstract] | ||||||
Dividends declared (in dollars per share) | $ 0.38 | $ 0.38 | $ 0.36 | $ 0.36 | $ 0.75 | $ 0.72 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows $ in Millions, ¥ in Billions | 6 Months Ended | |
Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | |
Operating activities | ||
Consolidated net income | $ 28.5 | $ 76.2 |
Adjustments to reconcile consolidated net income to net cash flows from operating activities: | ||
Depreciation and amortization | 91.8 | 77.6 |
Deferred income taxes | (6.8) | (16.9) |
Stock-based compensation expense | 27 | 36 |
Provision for bad debt | 2.5 | 1.3 |
Equity in investments of unconsolidated entities | 3.1 | 1.4 |
Gain on equity method transaction | (49.6) | 0 |
Other, net | (6.6) | 4.5 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (14.9) | (35.4) |
Accounts payable and accrued liabilities | (9) | 3.8 |
Accrued compensation and deferred commissions | (34.2) | (102.8) |
Income taxes, current | (24.2) | (2.9) |
Deferred revenue | 44.7 | 64.8 |
Other assets and liabilities | (4.4) | (15.4) |
Cash provided by operating activities | 47.9 | 92.2 |
Investing activities | ||
Purchases of investment securities | (5.2) | (24.3) |
Proceeds from maturities and sales of investment securities | 11.9 | 32.4 |
Capital expenditures | (59.8) | (59.7) |
Acquisitions, net of cash acquired | 0 | (646.6) |
Proceeds from sale of equity method investments, net | 26.2 | 0 |
Purchases of investments in unconsolidated entities | (0.9) | (26.6) |
Other, net | 0 | (0.2) |
Cash used for investing activities | (27.8) | (725) |
Financing activities | ||
Common shares repurchased | (1.4) | (202.5) |
Dividends paid | (31.9) | (30.9) |
Proceeds from revolving credit facility | 230 | 440 |
Repayment of revolving credit facility | (170) | (210) |
Proceeds from term facility | 0 | 600 |
Repayment of term facility | (16.3) | (10.9) |
Employee taxes withheld for stock awards | (19.9) | (18.5) |
Payment of acquisition-related earn-outs | (45.5) | (16.2) |
Other, net | 0.1 | (2.1) |
Cash provided by (used for) financing activities | (54.9) | 548.9 |
Effect of exchange rate changes on cash and cash equivalents | 1.5 | (19.7) |
Net decrease in cash and cash equivalents | (33.3) | (103.6) |
Cash and cash equivalents—beginning of period | 376.6 | 483.8 |
Cash and cash equivalents—end of period | 343.3 | 380.2 |
Supplemental disclosure of cash flow information: | ||
Cash paid for income taxes | 33.1 | 44.6 |
Cash paid for interest | $ 28.2 | $ 7 |
Basis of Presentation of Interi
Basis of Presentation of Interim Financial Information | 6 Months Ended |
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation of Interim Financial Information | Basis of Presentation of Interim Financial Information The accompanying unaudited condensed consolidated financial statements of Morningstar, Inc. and subsidiaries (Morningstar, we, our, the Company) have been prepared to conform to the rules and regulations of the Securities and Exchange Commission (SEC). The preparation of financial statements in conformity with accounting principles generally accepted in the United States (GAAP) requires management to make estimates and assumptions that affect the reported amount of assets, liabilities, revenues, and expenses. Actual results could differ from those estimates. In the opinion of management, the statements reflect all adjustments, which are of a normal recurring nature, necessary to present fairly our financial position, results of operations, equity, and cash flows. These financial statements and notes are unaudited and should be read in conjunction with our Audited Consolidated Financial Statements and Notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 24, 2023 (our Annual Report). The acronyms that appear in the Notes to our Unaudited Condensed Consolidated Financial Statements refer to the following: ASC: Accounting Standards Codification ASU: Accounting Standards Update FASB: Financial Accounting Standards Board |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Our significant accounting policies are included in Note 2 of the Notes to our Audited Consolidated Financial Statements included in our Annual Report. Severance: We account for post-employment benefits in accordance with FASB ASC 712, Compensation - Non-retirement Post-employment Benefits (FASB ASC 712). Under FASB ASC 712, we recognize compensation expense associated with these benefits as a liability when probable and estimable. In July 2022, the Company began to significantly reduce its operations in Shenzhen, China and to shift the work related to its global business functions, including global product and software development, managed investment data collection and analysis, and equity data collection and analysis, to other Morningstar locations. As a result of these activities, the Company incurred $25.9 million of severance expense in 2022, which represented substantially all of the severance costs expected to be incurred with the remainder to be recognized through the third quarter of 2023. We recorded an immaterial amount of additional severance expense during the first and second quarters of 2023. We have $14.2 million of accrued severance remaining as of June 30, 2023, which we expect will be substantially paid through the third quarter of 2023. The liability is recorded within "Accrued compensation - current" on our Consolidated Balance Sheet. |
Credit Arrangements
Credit Arrangements | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
Credit Arrangements | Credit Arrangements Debt The following table summarizes our debt as of June 30, 2023 and December 31, 2022: (in millions) As of June 30, 2023 As of December 31, 2022 Term Facility, net of unamortized debt issuance costs of $0.7 million and $0.7 million, respectively $ 625.0 $ 641.1 Revolving Credit Facility 180.0 120.0 2.32% Senior Notes due October 26, 2030, net of unamortized debt issuance costs of $1.5 million and $1.5 million, respectively 348.5 348.5 Total debt $ 1,153.5 $ 1,109.6 Credit Agreement On July 2, 2019, the Company entered into a senior credit agreement (the 2019 Credit Agreement). The 2019 Credit Agreement provided the Company with a five-year multi-currency credit facility with an initial borrowing capacity of up to $750.0 million, including a $300.0 million revolving credit facility (the 2019 Revolving Credit Facility) and a term loan facility of $450.0 million. The 2019 Credit Agreement also provided for the issuance of up to $50.0 million of letters of credit and a $100.0 million sub-limit for a swingline facility under the 2019 Revolving Credit Facility. On May 6, 2022, the Company terminated the 2019 Credit Agreement. On May 6, 2022, the Company entered into a new senior credit agreement (the 2022 Credit Agreement). The 2022 Credit Agreement provided the Company with a five-year multi-currency credit facility with an initial borrowing capacity of up to $1.1 billion, including a $650.0 million term loan (the 2022 Term Facility) with an initial draw of $600.0 million and an option for a second draw of up to $50.0 million and a $450.0 million revolving credit facility (the 2022 Revolving Credit Facility). The 2022 Credit Agreement also provides for the issuance of up to $50.0 million of letters of credit and a $100.0 million sub-limit for a swingline facility under the 2022 Revolving Credit Facility. The proceeds of the first draw under the 2022 Term Facility and initial borrowings under the 2022 Revolving Credit Facility were used to finance the acquisition of Leveraged Commentary & Data (LCD) and to repay a portion of the borrowings under the 2019 Revolving Credit Facility. The 2022 Credit Agreement was amended (the Amended 2022 Credit Agreement) on September 13, 2022 (the First Amendment to the 2022 Credit Agreement) and on September 30, 2022 (the Second Amendment to the 2022 Credit Agreement). The First Amendment to the 2022 Credit Agreement terminated the unfunded term commitment related to the optional second draw of up to $50.0 million in the 2022 Term Facility and increased the 2022 Revolving Credit Facility to $600.0 million. The Second Amendment to the 2022 Credit Agreement increased the 2022 Term Facility to a fully funded $650.0 million facility (the Amended 2022 Term Facility) and increased the 2022 Revolving Credit Facility to $650.0 million (the Amended 2022 Revolving Credit Facility) for total borrowing capacity of $1.3 billion. As of June 30, 2023, our total outstanding debt under the Amended 2022 Credit Agreement was $805.0 million, net of debt issuance costs, with borrowing availability of $470.0 million under the Amended 2022 Revolving Credit Facility. Except for incremental borrowing capacity, there were no material changes to the existing terms and conditions of the 2022 Credit Agreement. The proceeds of the additional draw under the Amended 2022 Term Facility were used to repay borrowings under the 2022 Revolving Credit Facility. The proceeds of future borrowings under the Amended 2022 Revolving Credit Facility may be used for working capital, capital expenditures, or any other general corporate purpose. The interest rate applicable to any loan under the Amended 2022 Credit Agreement is, at the Company's option, either: (i) the applicable Secured Overnight Financing Rate (SOFR) plus an applicable margin for such loans, which ranges between 1.00% and 1.48%, based on the Company's consolidated leverage ratio or (ii) the lender's base rate plus the applicable margin for such loans, which ranges between 0.00% and 0.38%, based on the Company's consolidated leverage ratio. The portions of deferred debt issuance costs related to the Amended 2022 Revolving Credit Facility are included in other current and non-current assets, and the portion of deferred debt issuance costs related to the Amended 2022 Term Facility is reported as a reduction to the carrying amount of the Amended 2022 Term Facility. Debt issuance costs related to the Amended 2022 Revolving Credit Facility are amortized on a straight-line basis to interest expense over the term of the Amended 2022 Credit Agreement. Debt issuance costs related to the Amended 2022 Term Facility are amortized to interest expense using the effective interest method over the term of the Amended 2022 Credit Agreement. Private Placement Debt Offering On October 26, 2020, we completed the issuance and sale of $350.0 million aggregate principal amount of 2.32% senior notes due October 26, 2030 (the 2030 Notes), in a private placement exempt from the registration requirements of the Securities Act of 1933, as amended. Proceeds were primarily used to pay off a portion of the Company's outstanding debt under the 2019 Credit Agreement. Interest on the 2030 Notes is payable semi-annually on each October 30 and A pril 30 during the term of the 2030 Notes and at maturity. As of June 30, 2023, our total outstanding debt, net of issuance costs, under the 2030 Notes was $348.5 million. Compliance with Covenants Each of the Amended 2022 Credit Agreement and the 2030 Notes include customary representations, warranties, and covenants, including financial covenants, that require us to maintain specified ratios of consolidated earnings before interest, taxes, depreciation, and amortization (EBITDA) to consolidated interest charges and consolidated funded indebtedness to consolidated EBITDA, which are evaluated on a quarterly basis. We were in compliance with these financial covenants as of June 30, 2023. |
Acquisitions, Goodwill and Othe
Acquisitions, Goodwill and Other Intangible Assets | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Acquisitions, Goodwill and Other Intangible Assets | Acquisitions, Goodwill, and Other Intangible Assets 2023 Acquisitions We did not make any acquisitions during the second quarter and first six months of 2023. Goodwill The following table shows the changes in our goodwill balance from December 31, 2022 to June 30, 2023: (in millions) Balance as of December 31, 2022 $ 1,571.7 Foreign currency translation 13.0 Balance as of June 30, 2023 $ 1,584.7 We did not record any goodwill impairment losses in the first six months of 2023 or 2022. We perform our annual impairment reviews in the fourth quarter or when impairment indicators and triggering events are identified. Intangible Assets The following table summarizes our intangible assets: As of June 30, 2023 As of December 31, 2022 (in millions) Gross Accumulated Amortization Net Weighted Average Useful Life (years) Gross Accumulated Amortization Net Weighted Average Useful Life (years) Customer-related assets $ 600.5 $ (243.2) $ 357.3 14 $ 595.1 $ (221.3) $ 373.8 14 Technology-based assets 315.4 (186.4) 129.0 8 312.8 (173.8) 139.0 8 Intellectual property & other 93.0 (60.8) 32.2 8 92.1 (56.3) 35.8 8 Total intangible assets $ 1,008.9 $ (490.4) $ 518.5 12 $ 1,000.0 $ (451.4) $ 548.6 12 The following table summarizes our amortization expense related to intangible assets: Three months ended June 30, Six months ended June 30, (in millions) 2023 2022 2023 2022 Amortization expense $ 17.7 $ 15.6 $ 35.2 $ 29.7 We amortize intangible assets using the straight-line method over their expected economic useful lives. As of June 30, 2023, we expect intangible amortization expense for the remainder of 2023 and subsequent years to be as follows: (in millions) Remainder of 2023 (July 1 through December 31) $ 36.0 2024 65.2 2025 56.8 2026 53.0 2027 45.9 Thereafter 261.6 Total $ 518.5 Our estimates of future amortization expense for intangible assets may be affected by future acquisitions, divestitur es, changes in the estimated useful lives, i mpairments, and foreign currency translation. |
Income Per Share
Income Per Share | 6 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
Income Per Share | Income Per Share The following table shows how we reconcile our net income and the number of shares used in computing basic and diluted net income per share: Three months ended June 30, Six months ended June 30, (in millions, except share and per share amounts) 2023 2022 2023 2022 Basic net income per share: Consolidated net income $ 36.1 $ 30.1 $ 28.5 $ 76.2 Weighted average common shares outstanding 42.6 42.6 42.6 42.8 Basic net income per share $ 0.85 $ 0.71 $ 0.67 $ 1.78 Diluted net income per share: Consolidated net income $ 36.1 $ 30.1 $ 28.5 $ 76.2 Weighted average common shares outstanding 42.6 42.6 42.6 42.8 Net effect of dilutive stock options and restricted stock units 0.2 0.3 0.2 0.3 Weighted average common shares outstanding for computing diluted income per share 42.8 42.9 42.8 43.1 Diluted net income per share $ 0.84 $ 0.70 $ 0.67 $ 1.77 During the periods presented, the number of anti-dilutive restricted stock units, performance share awards, or market stock units excluded from our calculation of diluted earnings per share was immaterial. |
Revenue
Revenue | 6 Months Ended |
Jun. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Disaggregation of Revenue The following table presents our revenue disaggregated by revenue type. Sales and usage-based taxes are excluded from revenue. Three months ended June 30, Six months ended June 30, (in millions) 2023 2022 2023 2022 License-based $ 376.0 $ 327.5 $ 740.0 $ 639.4 Asset-based 67.3 67.6 132.6 136.1 Transaction-based 61.4 75.3 111.8 151.9 Consolidated revenue $ 504.7 $ 470.4 $ 984.4 $ 927.4 License-based performance obligations are generally satisfied over time as the customer has access to the product or service during the term of the subscription license and the level of service is consistent during the contract period. License-based agreements typically have a term of 1 to 3 years and are accounted for as subscription services available to customers and not as a license under the accounting guidance. License-based revenue is generated from the sale of PitchBook, Morningstar Data, Morningstar Direct, Morningstar Sustainalytics' license-based products, Morningstar Indexes data and services products, DBRS Morningstar's data products, Morningstar Advisor Workstation, and other similar product licenses. Asset-based performance obligations are satisfied over time as the customer receives continuous access to a service for the term of the agreement. Asset-based arrangements typically have a term of 1 to 3 years. Asset-based fees represent variable consideration, and the customer does not make separate purchasing decisions that result in additional performance obligations. Significant changes in the underlying fund assets and significant disruptions in the market are evaluated to determine whether estimates of earned asset-based fees need to be revised for the current quarter. The timing of client asset reporting and the structure of certain contracts can result in a one-quarter lag between market movements and the impact on earned revenue. An estimate of variable consideration is included in the initial transaction price only to the extent it is probable that a significant reversal in the amount of the revenue recognized will not occur. Estimates of asset-based fees are based on the most recently completed quarter and, as a result, it is unlikely a significant reversal of revenue would occur. Asset-based revenue is generated by Investment Management, Workplace Solutions, and Morningstar Indexes. Transaction-based performance obligations are satisfied when the product or service is completed or delivered. Transaction-based revenue is generated by DBRS Morningstar, Morningstar Sustainalytics' Second Party Opinions, Internet advertising, and Morningstar-sponsored conferences. DBRS Morningstar revenue includes revenue from surveillance services, which is recognized over time, as the customer has access to the service during the surveillance period. Contract Liabilities Our contract liabilities represent deferred revenue. We record contract liabilities when cash payments are received or due in advance of our performance, including amounts which may be refundable. The contract liabilities balance as of June 30, 2023 had a net increase of $46.7 million, primarily driven by cash payments received or payable in advance of satisfying our performance obligations. We reco gnized $303.0 million of revenue in the six months ended June 30, 2023 that was included in the contract liabilities balance as of December 31, 2022. We expect to recognize revenue related to our contract liabilities, including future billings, for the remainder of 2023 and subsequent years as follows: (in millions) As of June 30, 2023 Remainder of 2023 (July 1 through December 31) $ 582.8 2024 424.0 2025 152.6 2026 37.1 2027 7.6 Thereafter 26.7 Total $ 1,230.8 The aggregate amount of revenue we expect to recognize for the remainder of 2023 and subsequent years is higher than our contract liability balance of $535.8 million as of June 30, 2023. The difference represents the value of future obligations for signed contracts that have yet to be billed. The table above does not include variable consideration for unsatisfied performance obligations related to certain of our license-based, asset-based, and transaction-based contracts as of June 30, 2023. We are applying the optional exemption available under ASC Topic 606, as the variable consideration relates to these unsatisfied performance obligations being fulfilled as a series. The performance obligations related to these contracts are expected to be satisfied over the next 1 to 3 years as services are provided to the client. For license-based contracts, the consideration received for services performed is based on the number of future users, which is not known until the services are performed. The variable consideration for this revenue can be affected by the number of user licenses, which cannot be reasonably estimated. For asset-based contracts, the consideration received for services performed is based on future asset values, which are not known until the services are performed. The variable consideration for this revenue can be affected by changes in the underlying value of fund assets due to client redemptions, additional investments, or movements in the market. For transaction-based contracts for Internet advertising, the consideration received for services performed is based on the number of impressions, which is not known until the impressions are created. The variable consideration for this revenue can be affected by the timing and quantity of impressions in any given period and cannot be reasonably estimated. As of June 30, 2023, the table above also does not include revenue for unsatisfied performance obligations related to certain of our license-based and transaction-based contracts with durations of one year or less since we are applying the optional exemption under ASC Topic 606. For certain license-based contracts, the remaining performance obligation is expected to be less than one year based on the corresponding subscription terms or the existence of cancellation terms that may be exercised causing the contract term to be less than one year from June 30, 2023. For transaction-based contracts, such as new credit rating issuances and Morningstar-sponsored conferences, the related performance obligations are expected to be satisfied within the next 12 months. Contract Assets Our contract assets represent accounts receivable, less allowance for credit losses, and deferred commissions. The following table summarizes our contract assets balance: (in millions) As of June 30, 2023 As of December 31, 2022 Accounts receivable, less allowance for credit losses $ 321.8 $ 307.9 Deferred commissions 75.1 76.1 Total contract assets $ 396.9 $ 384.0 |
Segment and Geographical Area I
Segment and Geographical Area Information | 6 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
Segment and Geographical Area Information | Segment and Geographical Area Information Segment Information We report our results in a single reportable segment, which reflects how our chief operating decision maker allocates resources and evaluates our financial results. Because we have a single reportable segment, all required financial segment information can be found directly in the consolidated financial statements. The accounting policies for our reportable segment are the same as those described in Note 2 of the Audited Consolidated Financial Statements included in our Annual Report. We evaluate the performance of our reporting segment based on revenue and operating income. Geographical Area Information The tables below summarize our revenue, long-lived assets, which includes property, equipment, and capitalized software, net, and operating lease assets, by geographical area: Revenue by geographical area Three months ended June 30, Six months ended June 30, (in millions) 2023 2022 2023 2022 United States $ 365.5 $ 338.1 $ 712.8 $ 666.3 Asia 11.6 11.5 23.7 22.3 Australia 14.6 14.7 29.0 28.7 Canada 30.1 29.5 57.4 56.6 Continental Europe 45.6 41.2 88.7 82.5 United Kingdom 34.7 32.9 67.8 66.0 Other 2.6 2.5 5.0 5.0 Total International 139.2 132.3 271.6 261.1 Consolidated revenue $ 504.7 $ 470.4 $ 984.4 $ 927.4 Property, equipment, and capitalized software, net by geographical area (in millions) As of June 30, 2023 As of December 31, 2022 United States $ 172.2 $ 165.6 Asia 12.3 12.8 Australia 1.9 2.3 Canada 4.4 4.5 Continental Europe 7.4 8.5 United Kingdom 7.2 5.4 Other 0.2 0.3 Total International 33.4 33.8 Consolidated property, equipment, and capitalized software, net $ 205.6 $ 199.4 Operating lease assets by geographical area (in millions) As of June 30, 2023 As of December 31, 2022 United States $ 111.3 $ 120.0 Asia 19.3 22.6 Australia 3.5 3.9 Canada 3.8 5.5 Continental Europe 16.2 18.5 United Kingdom 19.2 20.6 Other 0.3 0.5 Total International 62.3 71.6 Consolidated operating lease assets $ 173.6 $ 191.6 |
Fair Value Measurement of Inves
Fair Value Measurement of Investments | 3 Months Ended |
Jun. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Investments As of June 30, 2023 and December 31, 2022, our investment balances totaled $34.9 million and $38.0 million , respectively. We classify our investments into two categories: equity investments and debt securities. We further classify our debt securities into available-for-sale, held-to-maturity, and trading securities. Our investment portfolio consists of stocks, bonds, options, mutual funds, money market funds, or exchange-traded products that replicate the model portfolios and strategies created by Morningstar. These investment accounts may also include exchange-traded products where Morningstar is an index provider. As of June 30, 2023 , all investments in our investment portfolio have valuations based on quoted prices in active markets for identical assets or liabilities that we hav e the ability to access, and, therefore, are classified as Level 1 within the fair value hierarchy. We recognize unrealized holding gains or losses within "Other income (loss), net" on our Condensed Consolidated Statements of Income. Contingent Consideration As of December 31, 2022, financial liabilities that were classified as Level 3 within the fair value hierarchy included a contingent consideration liability of $50.0 million related to LCD, which represented the acquisition date fair value of $45.5 million plus changes due to remeasurement of this liability in subsequent reporting periods. The contingent consideration reflected potential future payments that were contingent upon the achievement of certain conditions related to the separation of LCD's contractual relationships from S&P Global (S&P) contracts that included other S&P products and services. This additional purchase consideration, for which the amount was contingent, was recognized at fair value at the date of acquisition, which was calculated as the weighted average of the estimated contingent payment scenarios. The contingent consideration was remeasured each reporting period until the contingency was resolved with any changes in fair value recorded in current period earnings. In the first quarter of 2023, we made a cash payment of $50.0 million, resolving our contingent consideration liability related to our acquisition of LCD. |
Investments in Unconsolidated E
Investments in Unconsolidated Entities | 6 Months Ended |
Jun. 30, 2023 | |
Investments in Unconsolidated Entities [Abstract] | |
Equity Method Investments and Joint Ventures Disclosure | Investments in Unconsolidated Entities As of June 30, 2023 and December 31, 2022, our investment in unconsolidated entities balance totaled $114.8 million and $96.0 million, respectively. We have investments in both equity method investments and investments in equity securities with and without a readily determinable fair value. On January 27, 2023, we entered into a Termination Agreement (the Termination Agreement) with Morningstar Japan K.K. (now known as SBI Global Asset Management Co., Ltd. (Wealth Advisors)), and a Tender Offer Agreement (the Tender Offer Ag reement) with SBI Global Asset Management Co., Ltd . (now known as SBI Asset Management Group Co., Ltd. (SBI )). Pursuant to the Termination Agreement, Wealth Advisors agreed to cease use of the Morningstar brand and Morningstar and Wealth Advisors agreed to terminate the License Agreement originally entered into in 1998. As consideratio n for the transaction, Morningstar agreed to pay Wealth Advisors 8 billion Japanese yen upon the termination of t he license agreement and the achievement of certain conditions related primarily to the termination of the use of the Morningstar brand by Wealth Advisors’ customers. On April 6, 2023, we made the first cash payment of 6 billion Japanese yen ($45.1 million) and on April 19, 2023, we made the second and final cash payment of 2 billion Japanese yen ($14.8 million), pursuant to the Termination Agreement. The total cash payments of $59.9 million are reflected in "Other assets and liabilities" within operating activities on the Condensed Consolidated Statements of Cash Flows. The expense related to the Termination Agreement is recorded within "Expense from equity method transaction, net" in our Condensed Consolidated Statements of Income for the six months ended June 30, 2023. As part of this transaction, pursuant to the Tender Offer Agreement, Morningstar agreed to tender up to 10 million shares in Wealth Advisors to SBI. The tender offer closed on February 28, 2023, and SBI purchased 8,040,600 shares of Wealth Advisors from Morningstar, resulting in net proceeds of $26.2 million and a pre-tax gain of $18.4 million. The pre-tax gain is recorded within "Expense from equity method transaction, net" in our Condensed Consolidated Statements of Income for the six months ended June 30, 2023. Subsequent to the tender offer, the Company's ownership percentage in Wealth Advisors decreased to 13.2% from 22.1%, and as a result, we no longer account for our investment in Wealth Advisors as an equity method investment. Each reporting period, we remeasure our remaining investment in Wealth Advisors, an equity security with a readily determinable value, at fair value and recognize unrealized holding gains or losses within "Other income (loss), net" on our Condensed Consolidated Statements of Income. During the first six months of 2023, we recognized an unrealized holding gain of $31.2 million, which is recorded within "Expense from equity method transaction, net" in our Condensed Consolidated Statement of Income. |
Leases
Leases | 6 Months Ended |
Jun. 30, 2023 | |
Leases [Abstract] | |
Leases | Leases We lease office space and certain equipment under various operating and finance leases, with most of our lease portfolio consisting of operating leases for office space. We determine whether an arrangement is, or includes, an embedded lease at contract inception. Operating lease assets and lease liabilities are recognized at the commencement date and initially measured using the present value of lease payments over the defined lease term. Lease expense is recognized on a straight-line basis over the lease term. For finance leases, we also recognize a finance lease asset and finance lease liability at inception, with lease expense recognized as interest expense and amortization. A contract is or contains an embedded lease if the contract meets all of the below criteria: • there is an identified asset; • we obtain substantially all the economic benefits of the asset; and • we have the right to direct the use of the asset. For initial measurement of the present value of lease payments and for subsequent measurement of lease modifications, we are required to use the rate implicit in the lease, if available. However, as most of our leases do not provide an implicit rate, we use our incremental borrowing rate, which is a collateralized rate. To apply the incremental borrowing rate, we used a portfolio approach and grouped leases based on similar lease terms in a manner whereby we reasonably expect that the application does not differ materially from a lease-by-lease approach. Our leases have remaining lease terms of approximately 1 year to 12 years, which may include the option to extend the lease when it is reasonably certain we will exercise that option. We do not have lease agreements with residual value guarantees, sale leaseback terms, or material restrictive covenants. Leases with an initial term of 12 months or less are not recognized on the balance sheet. We recognize lease expense for these leases on a straight-line basis over the lease term. Our operating lease expense for the three months ended June 30, 2023 wa s $13.4 mi llion, compared with $10.0 million for the three months ended June 30, 2022. Charges related to our operating leases that are variable and, therefore, not included in the measurement of the lease liabilities, were $4.9 million for the three months ended June 30, 2023, compared with $4.1 million for the three months ended June 30, 2022. We made lease payments of $11.6 million during the three months ended June 30, 2023, compared with $10.7 million during the three months ended June 30, 2022. Our operating lease expense for the six months ended June 30, 2023 was $25.1 million, compared with $20.2 million for the six months ended June 30, 2022. Charges related to our operating leases that are variable and, therefore, not included in the measurement of the lease liabilities, were $9.0 million for the six months ended June 30, 2023, compared with $8.0 million for the six months ended June 30, 2022. We made lease payments of $22.9 million during the six months ended June 30, 2023, compared with $21.5 million during the six months ended June 30, 2022. The following table shows our minimum future lease commitments due in each of the next five years and thereafter for operating leases: Minimum Future Lease Commitments (in millions) Operating Leases Remainder of 2023 (July 1 through December 31) $ 20.9 2024 43.6 2025 34.0 2026 37.7 2027 29.2 Thereafter 53.3 Total minimum lease commitments 218.7 Adjustment for discount to present value 22.1 Present value of lease liabilities $ 196.6 The following table summarizes the weighted-average remaining lease terms and weighted-average discount rates for our operating leases: As of June 30, 2023 Weighted-average remaining lease term (in years) 5.9 Weighted-average discount rate 3.5 % |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Stock-Based Compensation Plans Our employees and our non-employee directors are eligible for awards under the Morningstar Amended and Restated 2011 Stock Incentive Plan, which provides for a variety of stock-based awards, including stock options, restricted stock units, performance share awards, market stock units, and restricted stock. The following table summarizes the stock-based compensation expense included in each of our operating expense categories: Three months ended June 30, Six months ended June 30, (in millions) 2023 2022 2023 2022 Cost of revenue $ 7.2 $ 6.7 $ 12.2 $ 9.2 Sales and marketing 2.5 2.6 4.1 4.0 General and administrative 5.1 12.8 10.7 22.8 Total stock-based compensation expense $ 14.8 $ 22.1 $ 27.0 $ 36.0 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Effective Tax Rate The following table shows our effective tax rate for the three months ended June 30, 2023 and June 30, 2022: Three months ended June 30, Six months ended June 30, (in millions) 2023 2022 2023 2022 Income before income taxes and equity in investments of unconsolidated entities $ 31.7 $ 39.3 $ 33.8 $ 102.3 Equity in investments of unconsolidated entities (1.8) (1.8) (3.1) (1.4) Total $ 29.9 $ 37.5 $ 30.7 $ 100.9 Income tax expense (benefit) $ (6.2) $ 7.4 $ 2.2 $ 24.7 Effective tax rate (20.7) % 19.7 % 7.2 % 24.5 % Our effective tax rate in the second quarter and first six months of 2023 was (20.7)% and 7.2%, respectively, reflecting a decrease of 40.4 and 17.3 percentage points, respectively, compared with the same periods in the prior year. The decrease in the second quarter is primarily attributable to the recognition of $13.7 million of tax benefits related to a retroactive tax election with respect to our 2021 and 2022 tax periods. We received confirmation of the approval of the tax election during the second quarter of 2023, which allowed us to recognize the tax benefits in the period. Unrecognized Tax Benefits The table below provides information concerning our gross unrecognized tax benefits as of June 30, 2023 and December 31, 2022, as well as the effect these gross unrecognized tax benefits would have on our income tax expense, if they were recognized. (in millions) As of June 30, 2023 As of December 31, 2022 Gross unrecognized tax benefits $ 13.0 $ 26.5 Gross unrecognized tax benefits that would affect income tax expense $ 13.0 $ 26.5 Decrease in income tax expense upon recognition of gross unrecognized tax benefits $ 12.6 $ 26.1 Our gross unrecognized tax benefits decreased from $26.5 million as of December 31, 2022, to $13.0 million as of June 30, 2023. The decrease is primarily related to a retroactive tax election that was approved by a taxing authority during the second quarter of 2023, which resulted in the recognition of $13.7 million of current and deferred tax benefits with respect to our 2021 and 2022 tax periods. Our Unaudited Condensed Consolidated Balance Sheets include the following liabilities for unrecognized tax benefits. These amounts include interest and penalties, less any associated tax benefits. Liabilities for Unrecognized Tax Benefits (in millions) As of June 30, 2023 As of December 31, 2022 Current liability $ 7.9 $ 18.3 Non-current liability 6.4 6.0 Total liability for unrecognized tax benefits $ 14.3 $ 24.3 Our liability for unrecognized tax benefits decreased from $24.3 million as of December 31, 2022, to $14.3 million as of June 30, 2023. The decrease is primarily related to a retroactive tax election that was approved by a taxing authority during the second quarter of 2023, which resulted in the recognition of $10.6 million of current tax benefits with respect to our 2021 and 2022 tax periods. Because we conduct business globally, we file income tax returns in U.S. federal, state, local, and foreign jurisdictions. We are currently under audit by federal, state, and local tax authorities in the U.S. as well as tax authorities in certain non-U.S. jurisdictions. It is likely that the examination phase of some of these federal, state, local, and non-U.S. audits will conclude in 2023. It is not possible to estimate the effect of current audits on previously recorded unrecognized tax benefits. Approximatel y 74% o f our cash, cash equivalents, and investments balance as of June 30, 2023 was held by our operations outside of the United States. We generally consider our U.S. directly-owned foreign subsidiary earnings to be permanently reinvested. We believe that our cash balances and investments in the United States, along with cash generated from our U.S. operations, will be sufficient to meet our U.S. operating and cash needs for the foreseeable future, without requiring us to repatriate earnings from these foreign subsidiaries. Certain of our non-U.S. operations have incurred net operating losses (NOLs), which may become deductible to the extent these operations become profitable. For each of our operations, we evaluate whether it is more likely than not that the tax benefits related to NOLs will be realized. As part of this evaluation, we consider evidence such as tax planning strategies, historical operating results, forecasted taxable income, and recent financial performance. In the year that certain non-U.S. operations record a loss, we do not recognize a corresponding tax benefit, which increases our effective tax rate. Upon determining that it is more likely than not that the NOLs will be realized, we reduce the tax valuation allowances related to these NOLs, which results in a reduction to our income tax expense and our effective tax rate in that period. |
Contingencies
Contingencies | 6 Months Ended |
Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies We record accrued liabilities for litigation, regulatory, and other business matters when those matters represent loss contingencies that are both probable and estimable. In these cases, there may be an exposure to loss in excess of any amounts accrued. Unless a loss contingency is both probable and estimable, we do not establish an accrued liability. As litigation, regulatory, or other business matters develop, we evaluate on an ongoing basis whether such matters present a loss contingency that is probable and estimable. Data Audits and Reviews In our global data business, we include in our products, or directly redistribute to our customers, data and information licensed from third-party vendors. Our compliance with the terms of these licenses is reviewed internally and is also subject to audit by the third-party vendors. At any given time, we may be undergoing several such internal reviews and third-party vendor audits, and the results and findings may indicate that we may be required to make a payment for prior data usage. Due to a lack of available information and data, as well as potential variations of any audit or internal review findings, we generally are not able to reasonably estimate a possible loss, or range of losses, for these matters. In situations where more information or specific areas subject to audit are available, we may be able to estimate a potential range of losses. While we cannot predict the outcome of these processes, we do not anticipate they will have a material adverse effect on our business, operating results, or financial position. Ratings and Regulatory Matters Our ratings and related research activities, including credit ratings, ESG ratings, managed investment, and equity ratings, are or may in the future become subject to regulation or increased scrutiny from executive, legislative, regulatory, and private parties. As a result, those activities may be subject to governmental, regulatory, and legislative investigations, regulatory examinations in the ordinary course of business, subpoenas, and other forms of legal process, which may lead to claims and litigation that are based on these ratings and related research activities. Our regulated businesses are generally subject to periodic reviews, inspections, examinations, and investigations by regulators in the jurisdictions in which they operate, any of which may result in claims, legal proceedings, assessments, fines, penalties, disgorgement, or restrictions on business activities. While it is difficult to predict the outcome of any particular investigation or proceeding, we do not believe the result of any of these matters will have a material adverse effect on our business, operating results, or financial position. Credit Ratings Matters On June 15, 2023, the staff of the Division of Enforcement of the SEC provided a Wells notice to DBRS, Inc. (DBRS), indicating that they had reached a preliminary decision to recommend that the SEC authorize an enforcement action related to compliance with recordkeeping requirements for certain credit ratings-related communications sent over unapproved electronic messaging channels and disclosure and non-financial internal controls requirements related to former commercial mortgage-backed securities ratings methodologies DBRS used during the period July 2019 through November 2022. DBRS is discussing with the SEC staff a potential settled resolution of this investigation. Based on our assessment of the current stage of this investigation, our financial results as of June 30, 2023, include an immaterial accrual related to this investigation. At this time, we do not believe any outcome in this investigation will have a material adverse effect on our business, operating results, or financial position. Other Matters We are involved from time to time in commercial disputes and legal proceedings that arise in the normal course of our business. While it is difficult to predict the outcome of any particular dispute or proceeding, we do not believe the result of any of these matters will have a material adverse effect on our business, operating results, or financial position. |
Share Repurchase Program
Share Repurchase Program | 6 Months Ended |
Jun. 30, 2023 | |
Equity [Abstract] | |
Treasury Stock | Share Repurchase Program On December 6, 2022, the board of directors approved a share repurchase program that authorizes the Company to repurchase up to $500.0 million in shares of the Company's outstanding common stock, effective January 1, 2023. This authorization replaced the then-existing share repurchase program and expires on December 31, 2025. Under this authorization, we may repurchase shares from time to time at prevailing market prices on the open market or in private transactions in amounts that we deem appropriate. For the three and six months ended June 30, 2023, we repurc hased a total of 8,484 shares for $1.4 million. As of June 30, 2023, we have $498.6 million available for future repur chases under the current share repurchase program. |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Jun. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
Accounting Policies [Abstract] | ||
Recent Accounting Pronouncements Policy | Severance: We account for post-employment benefits in accordance with FASB ASC 712, Compensation - Non-retirement Post-employment Benefits (FASB ASC 712). Under FASB ASC 712, we recognize compensation expense associated with these benefits as a liability when probable and estimable. In July 2022, the Company began to significantly reduce its operations in Shenzhen, China and to shift the work related to its global business functions, including global product and software development, managed investment data collection and analysis, and equity data collection and analysis, to other Morningstar locations. As a result of these activities, the Company incurred $25.9 million of severance expense in 2022, which represented substantially all of the severance costs expected to be incurred with the remainder to be recognized through the third quarter of 2023. We recorded an immaterial amount of additional severance expense during the first and second quarters of 2023. We have $14.2 million of accrued severance remaining as of June 30, 2023, which we expect will be substantially paid through the third quarter of 2023. The liability is recorded within "Accrued compensation - current" on our Consolidated Balance Sheet. | |
Employee related liabilities, Current - Accrued Severance | $ 14.2 | |
Severance Costs | $ 25.9 |
Fair Value Measurements (Polici
Fair Value Measurements (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Investments- Debt and Equity Securities Policy | We classify our investments into two categories: equity investments and debt securities. We further classify our debt securities into available-for-sale, held-to-maturity, and trading securities. |
Leases, Codification Topic 842
Leases, Codification Topic 842 (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Leases [Abstract] | |
Lessee, Leases | We lease office space and certain equipment under various operating and finance leases, with most of our lease portfolio consisting of operating leases for office space. We determine whether an arrangement is, or includes, an embedded lease at contract inception. Operating lease assets and lease liabilities are recognized at the commencement date and initially measured using the present value of lease payments over the defined lease term. Lease expense is recognized on a straight-line basis over the lease term. For finance leases, we also recognize a finance lease asset and finance lease liability at inception, with lease expense recognized as interest expense and amortization. A contract is or contains an embedded lease if the contract meets all of the below criteria: • there is an identified asset; • we obtain substantially all the economic benefits of the asset; and • we have the right to direct the use of the asset. For initial measurement of the present value of lease payments and for subsequent measurement of lease modifications, we are required to use the rate implicit in the lease, if available. However, as most of our leases do not provide an implicit rate, we use our incremental borrowing rate, which is a collateralized rate. To apply the incremental borrowing rate, we used a portfolio approach and grouped leases based on similar lease terms in a manner whereby we reasonably expect that the application does not differ materially from a lease-by-lease approach. |
Credit Arrangements (Tables)
Credit Arrangements (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
Summary of Total Debt and Long-term Debt | The following table summarizes our debt as of June 30, 2023 and December 31, 2022: (in millions) As of June 30, 2023 As of December 31, 2022 Term Facility, net of unamortized debt issuance costs of $0.7 million and $0.7 million, respectively $ 625.0 $ 641.1 Revolving Credit Facility 180.0 120.0 2.32% Senior Notes due October 26, 2030, net of unamortized debt issuance costs of $1.5 million and $1.5 million, respectively 348.5 348.5 Total debt $ 1,153.5 $ 1,109.6 |
Acquisitions, Goodwill and Ot_2
Acquisitions, Goodwill and Other Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following table shows the changes in our goodwill balance from December 31, 2022 to June 30, 2023: (in millions) Balance as of December 31, 2022 $ 1,571.7 Foreign currency translation 13.0 Balance as of June 30, 2023 $ 1,584.7 |
Schedule of Intangible Assets | The following table summarizes our intangible assets: As of June 30, 2023 As of December 31, 2022 (in millions) Gross Accumulated Amortization Net Weighted Average Useful Life (years) Gross Accumulated Amortization Net Weighted Average Useful Life (years) Customer-related assets $ 600.5 $ (243.2) $ 357.3 14 $ 595.1 $ (221.3) $ 373.8 14 Technology-based assets 315.4 (186.4) 129.0 8 312.8 (173.8) 139.0 8 Intellectual property & other 93.0 (60.8) 32.2 8 92.1 (56.3) 35.8 8 Total intangible assets $ 1,008.9 $ (490.4) $ 518.5 12 $ 1,000.0 $ (451.4) $ 548.6 12 |
Schedule of Intangible Asset, Amortization Expense | The following table summarizes our amortization expense related to intangible assets: Three months ended June 30, Six months ended June 30, (in millions) 2023 2022 2023 2022 Amortization expense $ 17.7 $ 15.6 $ 35.2 $ 29.7 |
Schedule of Expected Amortization Expense | June 30, 2023, we expect intangible amortization expense for the remainder of 2023 and subsequent years to be as follows: (in millions) Remainder of 2023 (July 1 through December 31) $ 36.0 2024 65.2 2025 56.8 2026 53.0 2027 45.9 Thereafter 261.6 Total $ 518.5 |
Income Per Share (Tables)
Income Per Share (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table shows how we reconcile our net income and the number of shares used in computing basic and diluted net income per share: Three months ended June 30, Six months ended June 30, (in millions, except share and per share amounts) 2023 2022 2023 2022 Basic net income per share: Consolidated net income $ 36.1 $ 30.1 $ 28.5 $ 76.2 Weighted average common shares outstanding 42.6 42.6 42.6 42.8 Basic net income per share $ 0.85 $ 0.71 $ 0.67 $ 1.78 Diluted net income per share: Consolidated net income $ 36.1 $ 30.1 $ 28.5 $ 76.2 Weighted average common shares outstanding 42.6 42.6 42.6 42.8 Net effect of dilutive stock options and restricted stock units 0.2 0.3 0.2 0.3 Weighted average common shares outstanding for computing diluted income per share 42.8 42.9 42.8 43.1 Diluted net income per share $ 0.84 $ 0.70 $ 0.67 $ 1.77 |
Revenue (Tables)
Revenue (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table presents our revenue disaggregated by revenue type. Sales and usage-based taxes are excluded from revenue. Three months ended June 30, Six months ended June 30, (in millions) 2023 2022 2023 2022 License-based $ 376.0 $ 327.5 $ 740.0 $ 639.4 Asset-based 67.3 67.6 132.6 136.1 Transaction-based 61.4 75.3 111.8 151.9 Consolidated revenue $ 504.7 $ 470.4 $ 984.4 $ 927.4 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction | We expect to recognize revenue related to our contract liabilities, including future billings, for the remainder of 2023 and subsequent years as follows: (in millions) As of June 30, 2023 Remainder of 2023 (July 1 through December 31) $ 582.8 2024 424.0 2025 152.6 2026 37.1 2027 7.6 Thereafter 26.7 Total $ 1,230.8 |
Summary of Contract Assets and Change in Deferred Commissions | The following table summarizes our contract assets balance: (in millions) As of June 30, 2023 As of December 31, 2022 Accounts receivable, less allowance for credit losses $ 321.8 $ 307.9 Deferred commissions 75.1 76.1 Total contract assets $ 396.9 $ 384.0 |
Segment and Geographical Area_2
Segment and Geographical Area Information (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas [Table Text Block] | The tables below summarize our revenue, long-lived assets, which includes property, equipment, and capitalized software, net, and operating lease assets, by geographical area: Revenue by geographical area Three months ended June 30, Six months ended June 30, (in millions) 2023 2022 2023 2022 United States $ 365.5 $ 338.1 $ 712.8 $ 666.3 Asia 11.6 11.5 23.7 22.3 Australia 14.6 14.7 29.0 28.7 Canada 30.1 29.5 57.4 56.6 Continental Europe 45.6 41.2 88.7 82.5 United Kingdom 34.7 32.9 67.8 66.0 Other 2.6 2.5 5.0 5.0 Total International 139.2 132.3 271.6 261.1 Consolidated revenue $ 504.7 $ 470.4 $ 984.4 $ 927.4 Property, equipment, and capitalized software, net by geographical area (in millions) As of June 30, 2023 As of December 31, 2022 United States $ 172.2 $ 165.6 Asia 12.3 12.8 Australia 1.9 2.3 Canada 4.4 4.5 Continental Europe 7.4 8.5 United Kingdom 7.2 5.4 Other 0.2 0.3 Total International 33.4 33.8 Consolidated property, equipment, and capitalized software, net $ 205.6 $ 199.4 Operating lease assets by geographical area (in millions) As of June 30, 2023 As of December 31, 2022 United States $ 111.3 $ 120.0 Asia 19.3 22.6 Australia 3.5 3.9 Canada 3.8 5.5 Continental Europe 16.2 18.5 United Kingdom 19.2 20.6 Other 0.3 0.5 Total International 62.3 71.6 Consolidated operating lease assets $ 173.6 $ 191.6 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Leases [Abstract] | |
Assets and Liabilities, Lessee | The following table summarizes the weighted-average remaining lease terms and weighted-average discount rates for our operating leases: As of June 30, 2023 Weighted-average remaining lease term (in years) 5.9 Weighted-average discount rate 3.5 % |
Lessee, Operating Lease, Liability, Maturity | The following table shows our minimum future lease commitments due in each of the next five years and thereafter for operating leases: Minimum Future Lease Commitments (in millions) Operating Leases Remainder of 2023 (July 1 through December 31) $ 20.9 2024 43.6 2025 34.0 2026 37.7 2027 29.2 Thereafter 53.3 Total minimum lease commitments 218.7 Adjustment for discount to present value 22.1 Present value of lease liabilities $ 196.6 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule Of Compensation Cost By Expense Category | The following table summarizes the stock-based compensation expense included in each of our operating expense categories: Three months ended June 30, Six months ended June 30, (in millions) 2023 2022 2023 2022 Cost of revenue $ 7.2 $ 6.7 $ 12.2 $ 9.2 Sales and marketing 2.5 2.6 4.1 4.0 General and administrative 5.1 12.8 10.7 22.8 Total stock-based compensation expense $ 14.8 $ 22.1 $ 27.0 $ 36.0 |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Income Tax Rate Reconciliation | The following table shows our effective tax rate for the three months ended June 30, 2023 and June 30, 2022: Three months ended June 30, Six months ended June 30, (in millions) 2023 2022 2023 2022 Income before income taxes and equity in investments of unconsolidated entities $ 31.7 $ 39.3 $ 33.8 $ 102.3 Equity in investments of unconsolidated entities (1.8) (1.8) (3.1) (1.4) Total $ 29.9 $ 37.5 $ 30.7 $ 100.9 Income tax expense (benefit) $ (6.2) $ 7.4 $ 2.2 $ 24.7 Effective tax rate (20.7) % 19.7 % 7.2 % 24.5 % |
Schedule of Gross Unrecognized Tax Benefits | The table below provides information concerning our gross unrecognized tax benefits as of June 30, 2023 and December 31, 2022, as well as the effect these gross unrecognized tax benefits would have on our income tax expense, if they were recognized. (in millions) As of June 30, 2023 As of December 31, 2022 Gross unrecognized tax benefits $ 13.0 $ 26.5 Gross unrecognized tax benefits that would affect income tax expense $ 13.0 $ 26.5 Decrease in income tax expense upon recognition of gross unrecognized tax benefits $ 12.6 $ 26.1 |
Schedule of Liabilities for Unrecognized Tax Benefits | Our gross unrecognized tax benefits decreased from $26.5 million as of December 31, 2022, to $13.0 million as of June 30, 2023. The decrease is primarily related to a retroactive tax election that was approved by a taxing authority during the second quarter of 2023, which resulted in the recognition of $13.7 million of current and deferred tax benefits with respect to our 2021 and 2022 tax periods. Our Unaudited Condensed Consolidated Balance Sheets include the following liabilities for unrecognized tax benefits. These amounts include interest and penalties, less any associated tax benefits. Liabilities for Unrecognized Tax Benefits (in millions) As of June 30, 2023 As of December 31, 2022 Current liability $ 7.9 $ 18.3 Non-current liability 6.4 6.0 Total liability for unrecognized tax benefits $ 14.3 $ 24.3 |
Credit Arrangements - Schedule
Credit Arrangements - Schedule of Long-term Debt (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Sep. 13, 2022 | May 06, 2022 | Oct. 26, 2020 | Jul. 02, 2019 |
Debt Instrument [Line Items] | |||||||
Long-term debt | $ 1,121.4 | $ 1,077.5 | |||||
Long-term debt | 1,153.5 | 1,109.6 | |||||
Debt Instrument, Interest Rate, Stated Percentage | 2.32% | ||||||
Maximum borrowing capacity | $ 650 | $ 600 | |||||
Medium-term Notes [Member] | Term Loan Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Long-term debt | 625 | 641.1 | |||||
Debt Issuance Costs, Gross | 0.7 | 0.7 | |||||
Maximum borrowing capacity | $ 450 | ||||||
Notes Payable, Other Payables | Private Placement | |||||||
Debt Instrument [Line Items] | |||||||
Long-term debt | 348.5 | 348.5 | |||||
Debt Issuance Costs, Gross | $ 1.5 | $ 1.5 | |||||
Debt Instrument, Interest Rate, Stated Percentage | 2.32% | 2.32% | |||||
Revolving Credit Facility | Line of Credit [Member] | July 2019 Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Long-term debt | $ 120 | ||||||
Maximum borrowing capacity | 300 | ||||||
Revolving Credit Facility | Line of Credit [Member] | May 2022 Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Long-term debt | $ 180 | ||||||
Maximum borrowing capacity | $ 450 | ||||||
Letters of credit [Member] | Line of Credit [Member] | July 2019 Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | $ 50 | ||||||
Letters of credit [Member] | Line of Credit [Member] | May 2022 Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Maximum borrowing capacity | $ 50 |
Credit Arrangements (Details)
Credit Arrangements (Details) - USD ($) $ in Millions | Sep. 30, 2022 | May 06, 2022 | Jul. 02, 2019 | Jun. 30, 2023 | Dec. 31, 2022 | Sep. 13, 2022 | Oct. 26, 2020 |
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | $ 650 | $ 600 | |||||
Remaining borrowing capacity | $ 470 | ||||||
Long-term debt, outstanding | 805 | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 2.32% | ||||||
Long-term debt | 1,121.4 | $ 1,077.5 | |||||
Medium-term Notes [Member] | Term Loan Facility [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | $ 450 | ||||||
Long-term debt | 625 | 641.1 | |||||
Line of Credit [Member] | Credit Agreement [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt Instrument, Term | 5 years | ||||||
Maximum borrowing capacity | $ 750 | ||||||
Line of Credit [Member] | Credit Agreement [Member] | Maximum [member] | Lender's base rate [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Basis spread on variable rate debt | 0.38% | ||||||
Line of Credit [Member] | Credit Agreement [Member] | Maximum [member] | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||||
Line of Credit Facility [Line Items] | |||||||
Basis spread on variable rate debt | 1.48% | ||||||
Line of Credit [Member] | Credit Agreement [Member] | Minimum [Member] | Lender's base rate [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Basis spread on variable rate debt | 0% | ||||||
Line of Credit [Member] | Credit Agreement [Member] | Minimum [Member] | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||||
Line of Credit Facility [Line Items] | |||||||
Basis spread on variable rate debt | 1% | ||||||
Line of Credit [Member] | July 2019 Revolving Credit Facility [Member] | Revolving Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | 300 | ||||||
Long-term debt | $ 120 | ||||||
Line of Credit [Member] | July 2019 Revolving Credit Facility [Member] | Letters of credit [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | 50 | ||||||
Line of Credit [Member] | May 6, 2022 Credit Agreement | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | $ 600 | ||||||
Line of Credit [Member] | May 6, 2022 Credit Agreement | Line of Credit [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Debt Instrument, Term | 5 years | ||||||
Maximum borrowing capacity | $ 1,100 | ||||||
Line of Credit [Member] | May 2022 Revolving Credit Facility | Revolving Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | 450 | ||||||
Long-term debt | $ 180 | ||||||
Line of Credit [Member] | May 2022 Revolving Credit Facility | Letters of credit [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | 50 | ||||||
Line of Credit [Member] | September 30, 2022, Credit Agreement Second Amendment | Line of Credit [Member] | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | $ 1,300 | ||||||
Notes Payable, Other Payables | Private Placement | |||||||
Line of Credit Facility [Line Items] | |||||||
Other Long-term Debt | $ 350 | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 2.32% | 2.32% | |||||
Long-term debt | $ 348.5 | $ 348.5 | |||||
Long-Term Debt | May 6, 2022 Revolving Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | 650 | ||||||
Line of Credit [Member] | July 2019 Revolving Credit Facility [Member] | Revolving Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | $ 100 | ||||||
Line of Credit [Member] | May 2022 Revolving Credit Facility | Revolving Credit Facility | |||||||
Line of Credit Facility [Line Items] | |||||||
Maximum borrowing capacity | $ 100 |
Acquisitions, Goodwill and Ot_3
Acquisitions, Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2023 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | Jun. 01, 2022 | |
Business Acquisition [Line Items] | |||||
Payment for Contingent Consideration Liability, Operating Activities | $ 50 | ||||
Contingent consideration liability | $ 0 | $ 50 | |||
Goodwill, impairment loss | $ 0 | $ 0 | |||
LCD | |||||
Business Acquisition [Line Items] | |||||
Contingent consideration liability | $ 45.5 |
Acquisitions, Goodwill and Ot_4
Acquisitions, Goodwill and Other Intangible Assets (Schedule of Goodwill) (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2023 USD ($) | |
Business Acquisition [Line Items] | |
Goodwill | $ 1,584.7 |
Goodwill [Roll Forward] | |
Goodwill, Beginning Balance | 1,571.7 |
Foreign currency translation | 13 |
Goodwill, Ending Balance | $ 1,584.7 |
Acquisitions, Goodwill and Ot_5
Acquisitions, Goodwill and Other Intangible Assets (Schedule of Intangible Assets) (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 1,008.9 | $ 1,000 |
Accumulated Amortization | (490.4) | (451.4) |
Total | $ 518.5 | $ 548.6 |
Weighted-Average Useful Life (years) | 12 years | 12 years |
Customer-related assets | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 600.5 | $ 595.1 |
Accumulated Amortization | (243.2) | (221.3) |
Total | $ 357.3 | $ 373.8 |
Weighted-Average Useful Life (years) | 14 years | 14 years |
Intellectual property & other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 93 | $ 92.1 |
Accumulated Amortization | (60.8) | (56.3) |
Total | $ 32.2 | $ 35.8 |
Weighted-Average Useful Life (years) | 8 years | 8 years |
Technology-Based Intangible Assets | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 315.4 | $ 312.8 |
Accumulated Amortization | (186.4) | (173.8) |
Total | $ 129 | $ 139 |
Weighted-Average Useful Life (years) | 8 years | 8 years |
Acquisitions, Goodwill and Ot_6
Acquisitions, Goodwill and Other Intangible Assets (Amortization Expense) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
Amortization expense | $ 17.7 | $ 15.6 | $ 35.2 | $ 29.7 | |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |||||
Remainder of 2023 (July 1 through December 31) | 36 | 36 | |||
2024 | 65.2 | 65.2 | |||
2025 | 56.8 | 56.8 | |||
2026 | 53 | 53 | |||
2027 | 45.9 | 45.9 | |||
Thereafter | 261.6 | 261.6 | |||
Total | $ 518.5 | $ 518.5 | $ 548.6 |
Acquisitions, Goodwill and Ot_7
Acquisitions, Goodwill and Other Intangible Assets - Acquired Intangibles (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 1,008.9 | $ 1,000 |
Accumulated Amortization | (490.4) | (451.4) |
Intangible assets, net | $ 518.5 | $ 548.6 |
Weighted-Average Useful Life (years) | 12 years | 12 years |
Customer-related assets | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 600.5 | $ 595.1 |
Accumulated Amortization | (243.2) | (221.3) |
Intangible assets, net | $ 357.3 | $ 373.8 |
Weighted-Average Useful Life (years) | 14 years | 14 years |
Intellectual property & other | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 93 | $ 92.1 |
Accumulated Amortization | (60.8) | (56.3) |
Intangible assets, net | $ 32.2 | $ 35.8 |
Weighted-Average Useful Life (years) | 8 years | 8 years |
Technology-Based Intangible Assets | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross | $ 315.4 | $ 312.8 |
Accumulated Amortization | (186.4) | (173.8) |
Intangible assets, net | $ 129 | $ 139 |
Weighted-Average Useful Life (years) | 8 years | 8 years |
Income Per Share (Details)
Income Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Earnings Per Share, Basic [Abstract] | ||||||
Consolidated net income | $ 36.1 | $ (7.6) | $ 30.1 | $ 46.1 | $ 28.5 | $ 76.2 |
Weighted average common shares outstanding | 42.6 | 42.6 | 42.6 | 42.8 | ||
Basic net income per share attributable to Morningstar, Inc. | $ 0.85 | $ 0.71 | $ 0.67 | $ 1.78 | ||
Earnings Per Share, Diluted [Abstract] | ||||||
Consolidated net income | $ 36.1 | $ 30.1 | $ 28.5 | $ 76.2 | ||
Weighted average common shares outstanding | 42.6 | 42.6 | 42.6 | 42.8 | ||
Net effect of dilutive stock options and restricted stock units | 0.2 | 0.3 | 0.2 | 0.3 | ||
Weighted average common shares outstanding for computing diluted income per share | 42.8 | 42.9 | 42.8 | 43.1 | ||
Diluted net income per share attributable to Morningstar, Inc. | $ 0.84 | $ 0.70 | $ 0.67 | $ 1.77 |
Revenue (Disaggregation of Reve
Revenue (Disaggregation of Revenue) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Consolidated revenue | $ 504.7 | $ 470.4 | $ 984.4 | $ 927.4 |
License-based | ||||
Disaggregation of Revenue [Line Items] | ||||
Consolidated revenue | 376 | 327.5 | 740 | 639.4 |
Asset-based | ||||
Disaggregation of Revenue [Line Items] | ||||
Consolidated revenue | 67.3 | 67.6 | 132.6 | 136.1 |
Transaction-based | ||||
Disaggregation of Revenue [Line Items] | ||||
Consolidated revenue | $ 61.4 | $ 75.3 | $ 111.8 | $ 151.9 |
Revenue (Disaggregation of Re_2
Revenue (Disaggregation of Revenue, Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenues | $ 504.7 | $ 470.4 | $ 984.4 | $ 927.4 |
Minimum [Member] | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue performance period | 1 year | 1 year | ||
Maximum [member] | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue performance period | 3 years | 3 years | ||
Licensed-based Revenue | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenues | $ 376 | 327.5 | $ 740 | 639.4 |
Licensed-based Revenue | Minimum [Member] | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue performance period | 1 year | 1 year | ||
Licensed-based Revenue | Maximum [member] | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue performance period | 3 years | 3 years | ||
Asset-based Revenue | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenues | $ 67.3 | $ 67.6 | $ 132.6 | $ 136.1 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-07-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue performance period | 6 months | 6 months | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue performance period | 1 year | 1 year | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue performance period | 2 years | 2 years | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue performance period | 3 years | 3 years | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-01-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue performance period | 4 years | 4 years | ||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2028-01-01 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Revenue performance period | 5 years | 5 years |
Revenue (Schedule of Contract L
Revenue (Schedule of Contract Liabilities) (Details) $ in Millions | Jun. 30, 2023 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Amount | $ 1,230.8 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-07-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Amount | $ 582.8 |
Revenue performance period | 6 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Amount | $ 424 |
Revenue performance period | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Amount | $ 152.6 |
Revenue performance period | 2 years |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Amount | $ 37.1 |
Revenue performance period | 3 years |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2027-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Amount | $ 7.6 |
Revenue performance period | 4 years |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2028-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, Remaining Performance Obligation, Amount | $ 26.7 |
Revenue performance period | 5 years |
Revenue (Contract Liabilities,
Revenue (Contract Liabilities, Additional Information Narrative) (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2023 USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Increase in contract liabilities from cash payments received | $ 46.7 |
Contract with Customer, Liability, Change in Timeframe, Performance Obligation Satisfied, Revenue Recognized | 303 |
Accounts payable and accrued liabilities | $ 535.8 |
Revenue | Revenue Disaggregation of Revenue The following table presents our revenue disaggregated by revenue type. Sales and usage-based taxes are excluded from revenue. Three months ended June 30, Six months ended June 30, (in millions) 2023 2022 2023 2022 License-based $ 376.0 $ 327.5 $ 740.0 $ 639.4 Asset-based 67.3 67.6 132.6 136.1 Transaction-based 61.4 75.3 111.8 151.9 Consolidated revenue $ 504.7 $ 470.4 $ 984.4 $ 927.4 License-based performance obligations are generally satisfied over time as the customer has access to the product or service during the term of the subscription license and the level of service is consistent during the contract period. License-based agreements typically have a term of 1 to 3 years and are accounted for as subscription services available to customers and not as a license under the accounting guidance. License-based revenue is generated from the sale of PitchBook, Morningstar Data, Morningstar Direct, Morningstar Sustainalytics' license-based products, Morningstar Indexes data and services products, DBRS Morningstar's data products, Morningstar Advisor Workstation, and other similar product licenses. Asset-based performance obligations are satisfied over time as the customer receives continuous access to a service for the term of the agreement. Asset-based arrangements typically have a term of 1 to 3 years. Asset-based fees represent variable consideration, and the customer does not make separate purchasing decisions that result in additional performance obligations. Significant changes in the underlying fund assets and significant disruptions in the market are evaluated to determine whether estimates of earned asset-based fees need to be revised for the current quarter. The timing of client asset reporting and the structure of certain contracts can result in a one-quarter lag between market movements and the impact on earned revenue. An estimate of variable consideration is included in the initial transaction price only to the extent it is probable that a significant reversal in the amount of the revenue recognized will not occur. Estimates of asset-based fees are based on the most recently completed quarter and, as a result, it is unlikely a significant reversal of revenue would occur. Asset-based revenue is generated by Investment Management, Workplace Solutions, and Morningstar Indexes. Transaction-based performance obligations are satisfied when the product or service is completed or delivered. Transaction-based revenue is generated by DBRS Morningstar, Morningstar Sustainalytics' Second Party Opinions, Internet advertising, and Morningstar-sponsored conferences. DBRS Morningstar revenue includes revenue from surveillance services, which is recognized over time, as the customer has access to the service during the surveillance period. Contract Liabilities Our contract liabilities represent deferred revenue. We record contract liabilities when cash payments are received or due in advance of our performance, including amounts which may be refundable. The contract liabilities balance as of June 30, 2023 had a net increase of $46.7 million, primarily driven by cash payments received or payable in advance of satisfying our performance obligations. We reco gnized $303.0 million of revenue in the six months ended June 30, 2023 that was included in the contract liabilities balance as of December 31, 2022. We expect to recognize revenue related to our contract liabilities, including future billings, for the remainder of 2023 and subsequent years as follows: (in millions) As of June 30, 2023 Remainder of 2023 (July 1 through December 31) $ 582.8 2024 424.0 2025 152.6 2026 37.1 2027 7.6 Thereafter 26.7 Total $ 1,230.8 The aggregate amount of revenue we expect to recognize for the remainder of 2023 and subsequent years is higher than our contract liability balance of $535.8 million as of June 30, 2023. The difference represents the value of future obligations for signed contracts that have yet to be billed. The table above does not include variable consideration for unsatisfied performance obligations related to certain of our license-based, asset-based, and transaction-based contracts as of June 30, 2023. We are applying the optional exemption available under ASC Topic 606, as the variable consideration relates to these unsatisfied performance obligations being fulfilled as a series. The performance obligations related to these contracts are expected to be satisfied over the next 1 to 3 years as services are provided to the client. For license-based contracts, the consideration received for services performed is based on the number of future users, which is not known until the services are performed. The variable consideration for this revenue can be affected by the number of user licenses, which cannot be reasonably estimated. For asset-based contracts, the consideration received for services performed is based on future asset values, which are not known until the services are performed. The variable consideration for this revenue can be affected by changes in the underlying value of fund assets due to client redemptions, additional investments, or movements in the market. For transaction-based contracts for Internet advertising, the consideration received for services performed is based on the number of impressions, which is not known until the impressions are created. The variable consideration for this revenue can be affected by the timing and quantity of impressions in any given period and cannot be reasonably estimated. As of June 30, 2023, the table above also does not include revenue for unsatisfied performance obligations related to certain of our license-based and transaction-based contracts with durations of one year or less since we are applying the optional exemption under ASC Topic 606. For certain license-based contracts, the remaining performance obligation is expected to be less than one year based on the corresponding subscription terms or the existence of cancellation terms that may be exercised causing the contract term to be less than one year from June 30, 2023. For transaction-based contracts, such as new credit rating issuances and Morningstar-sponsored conferences, the related performance obligations are expected to be satisfied within the next 12 months. Contract Assets Our contract assets represent accounts receivable, less allowance for credit losses, and deferred commissions. The following table summarizes our contract assets balance: (in millions) As of June 30, 2023 As of December 31, 2022 Accounts receivable, less allowance for credit losses $ 321.8 $ 307.9 Deferred commissions 75.1 76.1 Total contract assets $ 396.9 $ 384.0 |
Revenue (Summary of Contract As
Revenue (Summary of Contract Assets) (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Revenue from Contract with Customer [Abstract] | ||
Accounts receivable, less allowance for credit losses | $ 321.8 | $ 307.9 |
Deferred commissions, current and non-current | 75.1 | 76.1 |
Total contract assets | $ 396.9 | $ 384 |
Segment and Geographical Area_3
Segment and Geographical Area Information (External Revenue and Long-Lived Assets) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
External revenue | $ 504.7 | $ 470.4 | $ 984.4 | $ 927.4 | |
Long-lived assets | 205.6 | 205.6 | $ 199.4 | ||
United States | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
External revenue | 365.5 | 338.1 | 712.8 | 666.3 | |
Long-lived assets | 172.2 | 172.2 | 165.6 | ||
Total International | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
External revenue | 139.2 | 132.3 | 271.6 | 261.1 | |
Long-lived assets | 33.4 | 33.4 | 33.8 | ||
Canada | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
External revenue | 34.7 | 32.9 | 67.8 | 66 | |
Long-lived assets | 7.2 | 7.2 | 5.4 | ||
Continental Europe | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
External revenue | 45.6 | 41.2 | 88.7 | 82.5 | |
Long-lived assets | 7.4 | 7.4 | 8.5 | ||
Australia | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
External revenue | 14.6 | 14.7 | 29 | 28.7 | |
Long-lived assets | 1.9 | 1.9 | 2.3 | ||
Canada | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
External revenue | 30.1 | 29.5 | 57.4 | 56.6 | |
Long-lived assets | 4.4 | 4.4 | 4.5 | ||
United Kingdom | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
External revenue | 11.6 | 11.5 | 23.7 | 22.3 | |
Long-lived assets | 12.3 | 12.3 | 12.8 | ||
Other | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
External revenue | 2.6 | $ 2.5 | 5 | $ 5 | |
Long-lived assets | $ 0.2 | $ 0.2 | $ 0.3 |
Segment and Geographical Area_4
Segment and Geographical Area Information Segment and Geographical Area Information - Operating Lease Assets by Geographical Area (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Consolidated operating lease assets | $ 173.6 | $ 191.6 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Consolidated operating lease assets | 111.3 | 120 |
Total International | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Consolidated operating lease assets | 62.3 | 71.6 |
Canada | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Consolidated operating lease assets | 19.2 | 20.6 |
Continental Europe | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Consolidated operating lease assets | 16.2 | 18.5 |
Australia | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Consolidated operating lease assets | 3.5 | 3.9 |
Canada | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Consolidated operating lease assets | 3.8 | 5.5 |
United Kingdom | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Consolidated operating lease assets | 19.3 | 22.6 |
Other | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Consolidated operating lease assets | $ 0.3 | $ 0.5 |
Fair Value Measurements - Narra
Fair Value Measurements - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2023 | Jun. 30, 2023 | Dec. 31, 2022 | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |||
Investment balances | $ 34.9 | $ 38 | |
Payment for Contingent Consideration Liability, Operating Activities | $ 50 |
Investments in Unconsolidated_2
Investments in Unconsolidated Entities (Details) $ in Millions, ¥ in Billions | 1 Months Ended | 2 Months Ended | 3 Months Ended | 6 Months Ended | ||||||||||
Apr. 19, 2023 USD ($) | Apr. 19, 2023 JPY (¥) | Apr. 06, 2023 USD ($) | Apr. 06, 2023 JPY (¥) | Feb. 28, 2023 USD ($) shares | Jan. 27, 2023 JPY (¥) shares | Mar. 31, 2023 | Feb. 27, 2023 | Jun. 30, 2023 USD ($) | Mar. 31, 2023 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Investments in Unconsolidated Entities [Line Items] | ||||||||||||||
Business Exit Costs | $ 14.8 | ¥ 2 | $ 45.1 | ¥ 6 | ||||||||||
Investments in unconsolidated entities | $ 114.8 | $ 114.8 | $ 96 | |||||||||||
Payment for Contingent Consideration Liability, Operating Activities | $ 50 | |||||||||||||
Sale of Stock, Percentage of Ownership after Transaction | 13.20% | |||||||||||||
Sale of Stock, Percentage of Ownership before Transaction | 22.10% | |||||||||||||
Realized gain (loss) on sale of investments, reclassified from other comprehensive income | 0.3 | $ (3.1) | $ 0.5 | $ (2.1) | ||||||||||
Equity Method Investments and Joint Ventures Disclosure | Investments in Unconsolidated Entities As of June 30, 2023 and December 31, 2022, our investment in unconsolidated entities balance totaled $114.8 million and $96.0 million, respectively. We have investments in both equity method investments and investments in equity securities with and without a readily determinable fair value. On January 27, 2023, we entered into a Termination Agreement (the Termination Agreement) with Morningstar Japan K.K. (now known as SBI Global Asset Management Co., Ltd. (Wealth Advisors)), and a Tender Offer Agreement (the Tender Offer Ag reement) with SBI Global Asset Management Co., Ltd . (now known as SBI Asset Management Group Co., Ltd. (SBI )). Pursuant to the Termination Agreement, Wealth Advisors agreed to cease use of the Morningstar brand and Morningstar and Wealth Advisors agreed to terminate the License Agreement originally entered into in 1998. As consideratio n for the transaction, Morningstar agreed to pay Wealth Advisors 8 billion Japanese yen upon the termination of t he license agreement and the achievement of certain conditions related primarily to the termination of the use of the Morningstar brand by Wealth Advisors’ customers. On April 6, 2023, we made the first cash payment of 6 billion Japanese yen ($45.1 million) and on April 19, 2023, we made the second and final cash payment of 2 billion Japanese yen ($14.8 million), pursuant to the Termination Agreement. The total cash payments of $59.9 million are reflected in "Other assets and liabilities" within operating activities on the Condensed Consolidated Statements of Cash Flows. The expense related to the Termination Agreement is recorded within "Expense from equity method transaction, net" in our Condensed Consolidated Statements of Income for the six months ended June 30, 2023. As part of this transaction, pursuant to the Tender Offer Agreement, Morningstar agreed to tender up to 10 million shares in Wealth Advisors to SBI. The tender offer closed on February 28, 2023, and SBI purchased 8,040,600 shares of Wealth Advisors from Morningstar, resulting in net proceeds of $26.2 million and a pre-tax gain of $18.4 million. The pre-tax gain is recorded within "Expense from equity method transaction, net" in our Condensed Consolidated Statements of Income for the six months ended June 30, 2023. Subsequent to the tender offer, the Company's ownership percentage in Wealth Advisors decreased to 13.2% from 22.1%, and as a result, we no longer account for our investment in Wealth Advisors as an equity method investment. Each reporting period, we remeasure our remaining investment in Wealth Advisors, an equity security with a readily determinable value, at fair value and recognize unrealized holding gains or losses within "Other income (loss), net" on our Condensed Consolidated Statements of Income. During the first six months of 2023, we recognized an unrealized holding gain of $31.2 million, which is recorded within "Expense from equity method transaction, net" in our Condensed Consolidated Statement of Income. | |||||||||||||
Wealth Advisors [Member] | ||||||||||||||
Investments in Unconsolidated Entities [Line Items] | ||||||||||||||
Business Exit Costs | ¥ 8 | 59.9 | ||||||||||||
SBI | ||||||||||||||
Investments in Unconsolidated Entities [Line Items] | ||||||||||||||
Sale of Stock, Number of Shares Issued in Transaction | shares | 8,040,600 | 10,000,000 | ||||||||||||
Sale of Stock, Consideration Received Per Transaction | $ 26.2 | |||||||||||||
Gain on equity method transaction | $ 31.2 | |||||||||||||
Realized gain (loss) on sale of investments, reclassified from other comprehensive income | $ 18.4 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Lessee, Lease, Description [Line Items] | ||||
Operating lease expense | $ 13.4 | $ 10 | $ 25.1 | $ 20.2 |
Variable lease, cost | 4.9 | 4.1 | 9 | 8 |
Operating lease payments | $ 11.6 | $ 10.7 | $ 22.9 | $ 21.5 |
Minimum [Member] | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease, weighted average remaining lease term | 1 year | 1 year | ||
Maximum [member] | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease, weighted average remaining lease term | 12 years | 12 years |
Leases - Operating Lease Minimu
Leases - Operating Lease Minimum Future Lease Commitments (Details) $ in Millions | Jun. 30, 2023 USD ($) |
Leases [Abstract] | |
Remainder of 2019 | $ 20.9 |
2020 | 43.6 |
2021 | 34 |
2022 | 37.7 |
2023 | 29.2 |
Thereafter | 53.3 |
Total minimum lease commitments | 218.7 |
Adjustment for discount to present value | 22.1 |
Present value of lease liabilities | $ 196.6 |
Leases - Weighted Average Remai
Leases - Weighted Average Remaining Lease Terms and Discount Rates (Details) | Jun. 30, 2023 |
Weighted-average remaining lease term (in years) | |
Weighted-average remaining lease term (in years) | 5 years 10 months 24 days |
Weighted-average discount rate | |
Weighted-average discount rate | 3.50% |
Stock-Based Compensation (Alloc
Stock-Based Compensation (Allocation of Stock-Based Compensation Costs by Plan) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 14.8 | $ 22.1 | $ 27 | $ 36 |
Cost of revenue | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 7.2 | 6.7 | 12.2 | 9.2 |
Sales and marketing | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | 2.5 | 2.6 | 4.1 | 4 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total stock-based compensation expense | $ 5.1 | $ 12.8 | $ 10.7 | $ 22.8 |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narrative) (Details) - Restricted Stock Units and Performance Share Awards $ in Millions | 3 Months Ended |
Jun. 30, 2023 USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized stock-based compensation expense | $ 95.9 |
Expected amortization period (months) | 29 months |
Income Taxes (Income Tax Reconc
Income Taxes (Income Tax Reconciliation and Unrecognized Tax Benefits) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Effective Income Tax Rate Reconciliation, Amount [Abstract] | |||||
Income before income taxes and equity in net income (loss) of unconsolidated entities | $ 31.7 | $ 39.3 | $ 33.8 | $ 102.3 | |
Equity in investments of unconsolidated entities | (1.8) | (1.8) | (3.1) | (1.4) | |
Total | 29.9 | 37.5 | 30.7 | 100.9 | |
Income tax expense | $ (6.2) | $ 7.4 | $ 2.2 | $ 24.7 | |
Effective income tax rate | (20.70%) | 19.70% | 7.20% | 24.50% | |
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued [Abstract] | |||||
Current liability | $ 7.9 | $ 7.9 | $ 18.3 | ||
Non-current liability | 6.4 | 6.4 | 6 | ||
Total liability for unrecognized tax benefits | $ 14.3 | $ 14.3 | 24.3 | ||
Concentration Risk [Line Items] | |||||
Effective Income Tax Rate Reconciliation, Increase (Decrease) From Prior Year, PercentTaxes | 40.40% | 17.30% | |||
Unrecognized Tax Benefits | $ 13 | $ 13 | 26.5 | ||
Total Liability For Unrecognized Tax Benefits | 14.3 | $ 14.3 | $ 24.3 | ||
Current and Deferred Tax Benefits Related to Retrospective Tax Election | 13.7 | ||||
Current Tax Benefits Related to Retrospective Tax Election | $ 10.6 | ||||
Geographic Concentration Risk | Cash, Cash Equivalents and Investments | Total International | |||||
Concentration Risk [Line Items] | |||||
Percentage of cash, cash equivalents and investments held by operations outside of US | 74% |
Income Taxes (Income Tax Contin
Income Taxes (Income Tax Contingency) (Details) - USD ($) $ in Millions | Jun. 30, 2023 | Dec. 31, 2022 |
Income Tax Disclosure [Abstract] | ||
Gross unrecognized tax benefits | $ 13 | $ 26.5 |
Gross unrecognized tax benefits that would affect income tax expense | 13 | 26.5 |
Decrease in income tax expense upon recognition of gross unrecognized tax benefits | $ 12.6 | $ 26.1 |
Contingencies Contingencies (De
Contingencies Contingencies (Details) | 6 Months Ended |
Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Document Period End Date | Jun. 30, 2023 |
Share Repurchase Program (Detai
Share Repurchase Program (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2023 USD ($) shares | |
Subsequent Event [Line Items] | |
Share repurchase program, authorized amount | $ 500 |
Shares repurchased (in shares) | shares | 8,484 |
Shares repurchased, value | $ 1.4 |
Stock repurchase program, remaining authorized repurchase amount | $ 498.6 |