Conference Transcript - SPGI 2026-09-14

Wana Fetnake, Analyst — Barclays

All right. Good morning to, I guess, everybody. Thank you for being here. My name is Wana Fetnake. I cover business and information services for Barclays. We're very pleased to have with us today from S&P, Eric Abouf, who's the CFO. Thank you for being Eric. Eric, maybe just a place to start would be you've been now, I think, at the company about a year and a half almost. So just talk about, you know, what's kind of surprised you, both positive or negative, in the year and a half, and perhaps what have you brought to the table differently?

Eric Aboaf, CFO

Yeah, I think, you know, I spent, as you know, 20 years in banking in your corner of the world, and it's been really exciting to come to S&P. I've worked with S&P as a partner, a supplier, a vendor, whether it's around ratings, benchmarks for asset management, market data, energy data is probably the one area that I spent less time on before coming. And what I found is, much as I had expected, just a set of growth businesses focused on transparency, clarity, scenarios, and what can make financial institutions, corporations, and energy companies even more successful. And, you know, that's where I spend my time is where do we grow, where can we accelerate, what's next. There's a great innovation engine, which I think is a little different than what you see in banks, because banks have to be constrained by definition, and innovation is at the heart of what we do. And the areas I focus the most is around creating really transparency and MIS into our commercial activities, some of how we think about pipelines, some of how we think about sales, some of how we think about segments and targeting different segments, How we think about, you know, product offerings in one area that supports a different group of clients. Because as we've become larger and larger, there's so much to bring to our clients. We have to do over time is measure and operate at scale. And that requires a set of insights so that over time you can launch campaigns, you can roll out products more quickly, you can drive more productivity over time so that then we can deliver the margin expectations that our shareholders have that we have for ourselves while we reinvest in the business.

Wana Fetnake, Analyst — Barclays

And, you know, like yourself, there's been a lot of new management across the company as well. So maybe just some insights into, you know, how that shapes up today and, you know, looking forward.

Eric Aboaf, CFO

I think, you know, Martina and the team have brought a lot to the company over the last two years, you know, really thinking about in the, you know, we've had a great run five, you know, ten years, and really thinking about how do we drive the next round of growth, you know, the creation of the chief commercial officer organization where we cover 130 clients, which are the top third of our revenue base, is really a sea change for how we operate. And what we found is it's brought our product lines together at a level of sophistication and seniority where now we're having discussions in the boardroom with CEOs about the wide range of what they're facing out in the marketplace. You think about all the hyperscaler issuances, for example. You know, you've got CEOs of enormous banks like yours thinking about, you know, what does that mean for underwriting hyperscaler issuance? We've got our ratings understanding and insights there. Some of that's in the public domain. Some of that's in the private domain. What kind of market data do I need to really understand that? How do energy supply chains and electricity grids and so forth in different parts of the world play out? How do I want to underwrite electricity prices, which are inherent portions of data centers, which support those hyperscalers and those AI companies? So there's a wide range of activities that I think Martina has really thought about. How do we bring together to our clients that they can really value? And that's really an opportunity, one that we think is unique to us, because without the fortitude and the depth in each of those areas, we wouldn't be in the C-suite. Right. We'd be we'd be working with the CEOs of divisions or COOs of various divisions. But that client connectivity really is an opportunity. And, you know, what we find is that the stature, the sophistication, the trust that they have in S&P Global is is just second to none. Got it.

Wana Fetnake, Analyst — Barclays

OK, let's move on to, I guess, touch on the segments of the business. So maybe the first question to get it out of the way, I mean, there was some market rumors about you potentially, you know, considering the CapIQ business up for review. So, you know, just your comments on that.

Eric Aboaf, CFO

Well, you know, there's always been speculation. Just about every industry I've been in, probably you've been in. And, you know, it's a matter of principle. We're just not going to comment on unwanted rumors. It's just not helpful. I would say that right now, as we said, you know, as late as our second quarter earnings, we're highly focused on growth in MI, right? We've had a very strong, I'd say, solid start to the year. You know, growth is up north of 6%, comfortably within our guidance of 5.5% to 7% for the year. And, you know, we feel comfortable in delivering on that. And I think importantly, we've also said, look, we'll selectively trim elements of that portfolio, but we talked about small subscale product lines, which is the kind of thing we've done before. We've done it recently in the energy business where we thought that kind of software layer wasn't as valuable. Because in truth, we're really a data company, and what we're really doing is trying to find a share of benchmarks and data to our business, our clients.

Wana Fetnake, Analyst — Barclays

And some of those underperforming areas that you called out, any examples or which broader categories that would fall in? Or is it just on the software side, given the analogy to energy?

Eric Aboaf, CFO

I, it's actually not analogous to energy because the market intelligence data business is really quite strong. As I said, you know, growth of north of 6% top line first half of the year and comfort within our guide. You know, continued growth in platforms, including some big announcements we made in the second quarter around clients. Enterprise solutions, which is not just software. It's really system of record software solutions with a data component. That grew 10% year over year in the first two quarters of the year. So we're seeing real momentum there that's important. In the data space, we're growing at high single digits, low double digits, depending on which quarter we're looking at. We're signing up more clients for MCP connectors. We're up to 500, which is 50% more than the prior quarter. And data usage rates through API and LM call volume is up 5x, 5x Q1 to Q2, and it was 5x 4Q to 1Q, right? So think about the economic value that we're bringing to clients. And then just recently we've continued the integration of S&P data into the ChatGVT financial services workflows. And just last week, OpenAI released a study of those workflows and shared how error rates with the trusted proprietary branded S&P global data are below 3%. Our nearest competitor was at just around 6.5% errors. And it's something that clients have been telling us over the year, which is that our data is particularly valuable. They trust in it because of its quality. They can ingest it and process it in ways that are, in many cases, better than our peers and brings immediate value. And so I think there's a lot to come over the coming quarters and year as we see, you know, AI develop, interfaces for clients develop either within their own organizations through new channels that they're ingesting data for. But that's going to be the heart of growth of the MI.

Wana Fetnake, Analyst — Barclays

Okay. Yeah, just a few follow-ups on that. But before we get into that, you know, you used the mobility spinoff, you know, to resegment some of the numbers. So within MI, can you just remind us again what the new segmentation is and kind of why did you bucket those in such a way?

Eric Aboaf, CFO

MI is segmented in a pretty straightforward way. We've got the Kensho data and platform product line, which is about two-thirds of MI, and a third of it is the enterprise solutions, which is that workflow software. And we did it that way because in Kensho data and platforms, what we have is some unique platforms have been deeply embedded in client workflows. So think about the client franchise that we have there is exceedingly deep and broad at the same time. And Ken Show over the years has brought a set of data and MCP connectivity and so forth to that client base. And what we want to do is accelerate that, right, because we're happy for clients to connect to us through our proprietary platform, but also every other platform that exists out there. And we want to be on the forefront of any evolution that's playing out while we, you know, modernize and improve and so forth our own platforms. And then there's enterprise solutions, which is a great – and it's not just a software business, right? It's a system of record software business, which is critical to workflows for loan syndications, loan trading, private markets activity with iLevel, as an example, and creates an area, right, for clients not only to operate their businesses but to record their data, ingest our data and unique data that we pool across clients and, you know, creates real value and real growth for us. Got it.

Wana Fetnake, Analyst — Barclays

And in terms of the – so the segmentation, I think, makes sense. But help us – I think you had different leaders for each segment. Like I think you had Paveh, Shren, and Kensho Data, and et cetera. So why separate leadership, or is it just, you know, are they still talking to each other a lot, I suppose?

Eric Aboaf, CFO

Oh, they're definitely talking avidly. You know, what we have is we have an integrated, you know, multi-product sales force, right, that is really from a go-to-market standpoint holistic in how it approaches financials, corporates, even energy clients within MI. But the product set has some uniqueness, and so you want to create innovation and feature functionality and even new products within that product set, and that's why you've got that line up. And we, from an internal standpoint, look at our business from a client lens, client segments, right, the CCO clients, and then all the other groupings of clients of midsize and small clients. We look at a product lens, and we look at a regional lens, right, and there are a couple others, but let me just stick to those three, and that lets us find opportunities. It lets us spot execution successes in areas of further opportunity, and a good way for us to run the business. Got it.

Wana Fetnake, Analyst — Barclays

Let me run to the AI aspect of things. You talked about 500 MCP connectors now, the open an AI party, et cetera, impressive numbers, good growth. Can you just help us appreciate the monetization model? Like how is that going to convert into revenues and what are kind of the pluses and minuses of that?

Eric Aboaf, CFO

You know, for us, AI is an accelerant, right? Monetization will come over time. And what we want to do is be there for our clients as they're expanding and experimenting. You know, we talked about how some of the client discussions are even taking a little longer. Why? Because, you know, we're talking with them about not only our value-based pricing, but also experimenting with some volumetric pricing, right? And clients, on the other hand, are thinking to themselves, wow, I need even more of this data from S&P Global. I trust it. It's branded. It's reliable. It's got a curation that is unique. And they want to make sure that they can get as much of that as possible for, you know, for a reasonable price as well. And so there's just a – I think there's a development of an economic model or maybe a – I'll say we have an economic model around value pricing, which is around what clients use and how much they use and how many people use and what products they're engaged in that's pretty sophisticated. And I think over time, you know, that'll evolve probably a little more towards usage, but that transition will come over time because clients first need to actually experiment and experience it. And, you know, you've read about how folks are, you know, monitoring token usage and so forth. That's within their own environment. Typically, we provide the product, the data sets, you know, behind that for clients. And as, you know, as clients, you know, work through that evolution, they want us to be fair with them, and that will come with time. I think for now, we're extremely willing to encourage, right, and help them take full advantage of our data so long as they do it on our terms, right? Our terms are, you know, our data is proprietary. It's behind our paywall. It's not to be used for training, right? It's quite unique in ways, and we'll maintain that. And at the same time, of all the economic models, it makes sense.

Wana Fetnake, Analyst — Barclays

One of the concerns, I think, with the whole MCP and the AI connections is that customers might use it a la carte or whatever you want to call it through MCP, and that will come at the expense of your platform that they might have subscribed to. Are you seeing some of that trend, or is that something, you know, the MCP pricing might take, you know, offset? Just curious your thoughts on the pluses and minuses there.

Eric Aboaf, CFO

I'm smiling because we're not seeing an either-or, right? We're actually seeing folks continue to re-up on some of our proprietary platforms and ask for even more data. Now, the data business is growing much more quickly, right, which we're thrilled at. And in truth, we're agnostic, right? We'd love to grow the data business, not just high single digits, but mid-double-digit teams. We'd like to accelerate it through the breadth of channels. Over time, that's our expectation of what's likely to happen. And if that means that some of the platform revenue is replaced with data revenue, that's great. If the platform revenue continues to grow, which is what it's doing today, and we get data revenue on top of that, that's great as well. So there's a variety of different scenarios that we're looking towards. But in every one of those, there's an economic foundation of where we are today. There's a trusted brand of where we are today. There's control of our data, right, including audit rights and protections that we're going to ensure we have while we continue to serve our clients and see them grow with us.

Wana Fetnake, Analyst — Barclays

You mentioned token costs. I think one of the things investors are trying to figure out also is who's controlling token costs and how. So maybe a two-party, like specific to MI, and then even just broadly stepping back for all of S&P, you know, just some thoughts on, you know, what the token costs look like and how you control that.

Eric Aboaf, CFO

Yeah, but let's maybe take it from the sort of client side, and then we'll talk a little bit about internally. You know, clients of SNP, whether they're MI clients or energy clients or what have you, are, especially the largest clients, are building their own environments for large language models within their ecosystems, right, with harnesses and layers and so on and so forth. And they're trading off one model for another and optimizing an open source and so on and so forth. And what they're doing is we're connecting to them through our energy data sets or financial data sets or corporate data sets, right, and making sure they can access our data in a highly efficient manner and scaled manner. As they do that, right, it's quite natural for them, right, to incur the token cost because it's within their environment. For us, it's just we're just fulfilling data. And so primarily it's a client question. We want to make sure that our data gets them in a highly efficient way and a highly effective way so that they're not maxing out, right, of their own cost. And so that's the primary area where it comes to the fore. The other client area that has some importance is we're building AI functionality within our products and our energy ecosystem, our MI ecosystem, some of our ratings data is deployed through that. Configuring indices in our index business can be done by clients. And the AI drivers and feature functionality of those products, those tend to be on us. But they're much more, they're small scale in relation to just enormous amount of data pulling. And then finally, you know, we're using internally on productivity opportunities, whether it's data operations, software development speed, whether it's research, right, that we provide. And there you'd expect the CFO to do what he or she should be doing, which is just monitoring token costs and seeing who's using it and how much and then asking why. And if why has a good answer, you know, great. Let's do more of that because there are paybacks. And if why doesn't have such a hot answer, let's go and look again.

Wana Fetnake, Analyst — Barclays

I'm sure the other thing you're focusing a lot on is all these productivity issues are probably creating, you know, a margin opportunity. You guys already have pretty healthy margins, but how should we think about if we'll see some of that in the numbers or you put that all back into reinvestment? Just some thoughts there.

Eric Aboaf, CFO

I think you'll see both. I think you'll see continued margin expansion and reinvestment into our products, feature functionality, geographic growth, and so forth. I think what we're finding with AI is just another in the long list of tools, right, that we can put to use in data operations where we now see our way to, you know, 20% reduction in costs across a half-billion-dollar area. And now the discussion is with even the more advanced AI and AI quantitative models, can we go after the next 5%, 10%, 15%, 20% in-date operations, right? That's a discussion we're having right now as part of our budget cycle for 27, 28, and 29, as an example. You know, how exactly we'll get there, we'll figure out over time. But our view is that for a company of our scale, productivity matters, reinvestment matters, and we have continued confidence we can continue to deliver at the, you know, margin expansion of the 50 to 75 basis points, you know, across the company. And we've even said even higher in certain divisions. Got it.

Wana Fetnake, Analyst — Barclays

And just on that comment, maybe just help reiterate kind of the divisional qualitative guidance you gave at Invested in terms of margins. Like, where are the bigger opportunities?

Eric Aboaf, CFO

Yeah, we said, let me take it from two directions, right? We said that margin expansion will typically be 50 to 75 basis points for our divisions. You know, over time on average and so forth, right, they'll partly depend on the, you know, where we are in the revenue cycles. But we see that with confidence. We also said that MI, just because it's a higher proportion of the expense base, will be typically at the upper end of that. And, you know, to be honest, if you look at the first half results, you know, we had, what, 75 base points or more growth in margins in energy and index. We had, you know, more than 100 base points growth in margin in MI, and we had more than 200 base points so far growth in margin in ratings. Now, you know, happy year is to make a year, but it just gives you a sense for our ability to drive not only top line, but also margin expansion, including in areas where we're seeing both, you know, acceleration of cycles as well as some other scenarios. So it's been a good year, and we'll continue to do that.

Wana Fetnake, Analyst — Barclays

Got it. Before we move on to some of the other segments, you mentioned obviously all the leaders within MI are talking a lot to each other, but how is the communication between the leadership of your four different segments? How closely integrated are those conversations?

Eric Aboaf, CFO

It's become increasingly vivid and intense, and maybe I'll do it from a couple vantage points. For example, in our energy division, we have our supply chain assets and products that we've begun to knit together in a much more holistic offering. Well, that can go to our energy clients, to our corporate clients, to our financial clients. who are looking at the downstream implications of supply chains on the assets they've been underwriting. And so it's that kind of connectivity that the chief commercial office has brought together and said, look, we have a client need out there. Where do we have products? And it doesn't matter which division is. We have other areas that are just coming together because, as I mentioned, Some of the largest banks are deeply interested in ratings of the debt and companies that they're supporting. They're deeply interested in how those ratings compare to benchmarks relative to others, and we've been building partnerships and expanding our own data sets there. And they're deeply interested in kind of supply chain commodity dependency, including around trade for those underwritings. So I think the depth that we're seeing has really been multiplied by the focus on some of our largest clients and all their needs. Got it.

Wana Fetnake, Analyst — Barclays

Okay, let's move to the ratings business next. So I suppose first question is just around the – can you remind us of what your issuance guidance is for the second half of the year? I think from your data, we saw July was up 8% based on the number you disclosed, at least. So just how that flows into kind of the guide for the year.

Eric Aboaf, CFO

Yeah, the guide for the year is in the – started off in the low single digits for billed issuance. Now it's the mid to high single digits. We'll see exactly how it plays out. Remember, last year had some patterning to it. The first quarter was strong. Second quarter, a lot of concerns, plus some of the trade discussions, so very low issuances. And then some of that got delayed into third and fourth quarter. This year, I think, is a little more consistent across the quarters in dollar terms. But as a result, we've had a strong – a good first quarter, a very strong year-on-year compare in the second quarter. And then because of the very strong third and fourth quarter last year, while we'll have, I think, a very good third and fourth quarter, obviously market-dependent, the year-on-year compare will actually flip just because of the size of the upticks last year.

Wana Fetnake, Analyst — Barclays

Got it. And, you know, I think one of the things at least so far this quarter has been, I mean, it's been driven a lot by IG and high yield has been a little bit weak. So can you just help us how we should think about the mix of issuance coming in and how that might impact, you know, how we should model the business?

Eric Aboaf, CFO

Yeah. You know, year to date, we've had, you know, very strong hyperscalar issuance within the investment grade envelope. But if you actually look at the data, you know, we're in the 40% to 45% range for investment grade issuance this year. That's along the lines of the 45%-ish that we've seen, you know, 40% to 45%-ish that we've seen, you know, through the last, you know, 5, 10 years. So it's roughly in line. I think what we're seeing is a little more hyperscale or maybe a little less in other areas, but investment grade is doing quite well. Like you say, we're seeing, you know, not the same kind of momentum in high yield, but that comes and goes. What we do know is the refinancing walls for high yield for bank loans and so forth are quite strong. And I think there's also a bit of playing the interest rate rise and credit spreads. You know, clients are trying to see when they want to issue. Do they want to issue in advance or afterwards? And that will play out. I think what we have also seen is we've seen strong, in addition to strong refinancing walls and pipelines coming through this year, we've also seen good M&A activity, both announced and actually closed. That's been supportive environment. So it's been, while there's a lot of talk about the hyperscaler issuances, I think it's been a pretty broad-based year, and one that we feel good about. We talked about structured finance volumes, private markets volumes, public and private ratings are both up very significantly. So I'd say a really nice year and an indication, every indication is that kind of momentum, you know, should continue. Obviously, we'll see what markets and rates, how they play out, but that should continue in, you know, in various ways.

Wana Fetnake, Analyst — Barclays

Got it. Just one follow-up on the hyperscaler issuance. Obviously, they've been dominating the big headlines. I know you said, like, the growth has been even broader than hyperscaler, but maybe just for perspective, how much is hyperscaler issuance in your mix? And then the follow-up is kind of just, how is the monetization of that? Is that close to what a frequent issuer deal looks like? Or, you know, how does that, because these are big jumbo deals almost for the most part, right? Yeah.

Eric Aboaf, CFO

I mean, it's been helpful to the growth rate, but it's not been, you know, dispositive, right? This is a piece of many, many portions of the issuance environment around the world and across industry sets. The issuance is different than a frequent issuer program, and they are not in our frequent issuer program. Those tend to be reserved for some of the financials who need to just issue for funding purposes. These are just classic investment-grade issuances. Because they're so large, price realization is a little lower because we price that way for typically across the investment-grade environment. But it's one where, you know, we've gotten very healthy realization that we're pleased with. It's in line with what we've seen over the years for large-scale deals, and it's a place we can be supportive. What's interesting is it's not just vanilla bonds, it's structured finance, it's project finance, and that's an area where two, three years ago, we had really innovated and developed a set of methodologies that are particularly pertinent to the market. I think we led the market in that regard with methodologies that were deep and robust and rigorous. And so now clients come to us very quickly and say, hey, can you help us with a rating? Obviously, analytics and commercial are completely separate. But it's an area where we built the depth and capability that both public and private issuers are looking.

Wana Fetnake, Analyst — Barclays

Got it. And just on the margin side and ratings, you know, I mean, super impressive margins, super high incremental margins. It sounds like there's almost no ceiling. But how do you manage, you know, what the opportunity there is? Like, is there a, you know, kind of a range of margins that you try and, you know, make sure you're modeling to it?

Eric Aboaf, CFO

I think think about it in two perspectives. One is, as part of Investor Day back in November, we talked about 50 to 75 base points of margin expansion across our various product lines and divisions. And so that includes ratings. We think that there's a continuing opportunity there. At the same time, when we have very substantive growth in ratings, just like in any division, we think about how do we reinvest that, right? I think part of it is we're doing a lot of work, or we describe it as the analysts of the future. How do we leverage our analysts and help them get to all of our clients faster response times? How do we automate some of their surveillance work to make it even more efficient for them? And that lets us add more analytic talent back into areas that are developing. One of the ways we funded a lot of the structured finance work is we found ways to automate other categories and then add analytical horsepower and capacity in some of these newer market areas. Or we'll reinvest by cross-training our analysts, so they cover multiple zones. So there are ways we do that, and then it also gives us the opportunity to flex and think about where are there areas to, you know, tactically expand. You saw us do this small bolt-on of a Nigerian and African rating service, right? That supplements what we have. It's not only through acquisition, but there's a set of organic investments that we've been deploying and building, And that will continue to do so that the franchise has the same robustness, you know, five, six, seven, ten years from now as it does today by getting ahead of those opportunities.

Wana Fetnake, Analyst — Barclays

And maybe just a broader question. I mean, I think we've seen it on the rating side where your headcount has been, you know, almost flattish. And I'm guessing AI productivity, all that stuff helps. Is that a trend we should expect for the rest of the organization as well?

Eric Aboaf, CFO

I think you'll see more limited headcount growth than we have before, right? We've talked about in some of our areas, the enterprise data organization, you know, we've reached peak headcount. And now headcount will actually trend down as we just don't need to do as much hiring. And we have just, you know, natural turnover that we can take advantage of in general. And selectively, we'll adjust proactively. But the tool set has been so effective in that area in particular that, you know, we can see, you know, we can see headcount trends actually coming down. There are other areas where we're just seeing much more productivity, software developments, one that I think many industries are seeing. Researching is another analytical work, but we don't need to add a headcount each year to actually service growth, right, because we're doing it through productivity. And so I think we'll see more and more of that. And I think ratings, as you described, is a good indicator of that across the franchise, and one that we're working towards as we think about planning each year. Right now, we're starting to plan for 2027, right? We're thinking about all the areas of top-line opportunity as well as all the areas of productivity, and thinking about it now so that we can plan, put in place programs, and actually get the outcomes that we'd like. Got it.

Wana Fetnake, Analyst — Barclays

Okay, we have about six minutes left, so maybe some rapid fire into the two other segments. So talking about high margin businesses, indices, you know, I mean, can those margins go higher or is it a case of, you know, reinvesting into what's, you know, pretty impressive growth in there?

Eric Aboaf, CFO

I think it's both, again, right? Ratings, indices, they're great franchises, given the revenue dynamic, the secular expansion of those kind of ecosystems. And, you know, we continue to do work, you know, in indices, for example, work around DeFi, crypto, indices, recent partnership with Keiko, who's a particularly strong player in that whole ecosystem with infrastructure data and indices, what we're partnering with them on. And then we can build packages and products of indices for asset managers who want to create products around those, as an example. And that just follows around the innovation indices that we've done around fixed income, around multi-asset, around some of the sustainability indices, you know, when that was a particularly strong market. and one where we'll continue because what we want to do is build that industry and that business for the coming years as well as deliver on the current margin. So we'll be able to do both. Got it.

Wana Fetnake, Analyst — Barclays

Thank you. You addressed my revenue question there. So maybe let's just touch on energy real quick. Because of all the geopolitical issues, I think you had lowered the guidance there. Unfortunately, it's continuing. Can you remind us kind of what you had assumed in that guide in terms of how long the conflict continues? and I think you had guided to a return to trend next year. So is that still kind of in line with what you're thinking?

Eric Aboaf, CFO

Yeah, that's what we're thinking. We started the year with somewhat higher guidance. Right now we're about top-line growth of 4.5% to 6%. First half of the year has come in just around 4%. And we said in our last earnings call that we thought that second quarter would be the low point, And we'd see some acceleration. So we'll see that both on a half-to-half as well as a quarter-to-quarter basis. I think what we're seeing, what we're assuming is some amount of stabilization in energy markets. Now, stabilization in energy markets may be stalemates, right? So we're open to that environment. And we're seeing our energy clients adapt. They're highly resilient. They are they've historically been, you know, very large long term thinkers because of the asset intensivity of their of their businesses. And, you know, but but we see them adapting to this environment. What we've said is that next year we expect to come back into our medium term targets of six to eight percent for the for the energy division. And I think you'll see us build into that in the second half of the year. We also see that we won't be lapping some of the current sanctions, which are probably worth about 75 basis points across the energy division over the last couple of quarters. And that will also be a headwind we won't have to address.

Wana Fetnake, Analyst — Barclays

Yes, got it. And does the recent sale of the software assets, the SLB, does that help the mix in terms of revenue growth and margins as well?

Eric Aboaf, CFO

It does, because, you know, it was just a software slice of the value chain that we were engaged in. It wasn't at the heart of what we did within the Platts benchmarks and then the data and research around that. And so it didn't have the very good growth dynamics. And so by exiting and at the same time partnering in that area, we've got now a new partner through which we can actually distribute our proprietary data. It actually makes it even more comfortable for us to sell our data across the ecosystem of other software providers and platforms. And it's also an area where we're building out our interface tools so that that data can be distributed even more efficiently.

Wana Fetnake, Analyst — Barclays

And effectively, then it has more recently. We only have one minute left, but I wanted to ask you a capital allocation question. And instead of maybe running through the priorities, just since you've taken over, is there any nuance to that that has changed, even if it's just because of the environment out there in terms of what we should expect from S&P going forward?

Eric Aboaf, CFO

I think we've been clear at S&P that we want to be stewards of our capital in a couple of ways. We want to continue to invest and reinvest in our businesses, primarily on an organic basis. And that means creating enough productivity so that investors get both revenue growth driven by investments as well as margin expansion. That's at the heart of capital allocation from an organic standpoint. We said that we're only interested in both bonds and smaller acquisitions and nothing transformational. You saw us do a couple of those just earlier this month, right? Data Center Hawk, which is a data center power and forecasting area, a ratings regional expansion in Africa. That's typical, but we'll also prune on the margin, right? And small subscale product lines. Given our scale in half, we want to invest in the bigger and more sustainable areas because they either give us top-line growth or margin expansion capacity or both. Well, Andy, thank you so much, Eric, for being here. Thank you, everybody, as well. Thank you.