Moody's Corporation Reports Results for Second Quarter of 2007

Moody's Corporation (NYSE: MCO) today announced results for the
second quarter of 2007.

Summary of Results for Second Quarter 2007

Moody's reported revenue of $646.1 million for the three months
ended June 30, 2007, an increase of 26% from $511.4 million for the
same quarter of 2006. Operating income for the quarter was $363.7
million and rose 26% from $289.1 million for the same period of last
year. Diluted earnings per share were $0.95 and included $0.19 benefit
from the resolution of certain legacy tax matters. Excluding the
legacy tax effects in both periods, diluted earnings per share were
$0.76 in 2007 versus $0.58 in 2006, or a 31% increase.

Raymond McDaniel, Moody's Chairman and Chief Executive Officer,
commented, "Moody's delivered strong double-digit revenue growth for
the second quarter of 2007 across almost all lines of business and
geographies. Moody's strong results for the first half of 2007,
together with the diversity of our business around the world,
indicates that our results for the full year 2007 will reach mid-teens
percent growth in revenue and low- to mid-teens percent growth in
diluted earnings per share -- despite recent concerns about the U.S.
housing and high yield markets. The revenue growth expectation is
consistent with the lower end of the range from our previous guidance
and our EPS outlook is unchanged."

Second Quarter Revenue

Revenue at Moody's Investors Service for the second quarter of
2007 was $608.2 million, an increase of 28% from the prior year
period. Foreign currency translation positively impacted operating
results, mainly due to the weakness of the U.S. dollar relative to the
euro and the British pound, increasing revenue and operating income
growth by approximately 190 basis points.

Ratings revenue totaled $530.2 million in the quarter, rising 28%
from a year ago. Research revenue of $78 million was 26% higher than
in the second quarter of 2006. Within the ratings business, global
structured finance revenue totaled $273.4 million for the second
quarter of 2007, an increase of 26% from a year earlier. U.S.
structured finance revenue rose 21%, with very strong growth from
rating commercial mortgage-backed securities and credit derivatives,
somewhat offset by a 10% decline from rating residential
mortgage-backed securities. International structured finance revenue
rose 38%, benefiting from strength across all asset classes including
exceptional growth from the commercial mortgage-backed securities and
credit derivatives areas of the business.

Global corporate finance revenue of $141.0 million in the second
quarter of 2007 rose 37% from the same quarter of 2006. Revenue in the
U.S. rose 27% from the prior year period, reflecting very strong
growth from rating bank loans and speculative grade bonds. Outside the
U.S., corporate finance revenue increased 56% driven by strong growth
of investment- and speculative-grade issuance in Europe.

Global financial institutions and sovereigns revenue totaled $83.8
million for the second quarter of 2007, 25% higher than in the prior
year period. Revenue increased 24% in the U.S., driven primarily by
strong issuance in the banking and insurance sectors. Outside the
U.S., revenue grew 26% based largely on solid growth in the European
banking and insurance sectors.

U.S. public finance revenue was $32.0 million for the second
quarter of 2007, 13% higher than in the second quarter of 2006, driven
by strong growth in refunding activity primarily in the healthcare,
housing and higher education sectors of the business.

Moody's global research revenue rose to $78.0 million, increasing
26% from the same quarter of 2006. The quarter's growth was primarily
driven by strong sales of Moody's core research products to existing
customers and growth in new customers.

Revenue at Moody's KMV for the second quarter of 2007 was $37.9
million, 9% higher than in the second quarter of 2006, due primarily
to growth in risk product subscriptions and software maintenance fees.

Moody's U.S. revenue of $399.1 million for the second quarter of
2007 was up 22% from the second quarter of 2006. International revenue
of $247.0 million was 35% higher than in the prior year period and
included approximately 480 basis points of positive impact from
currency translation. International revenue accounted for 38% of
Moody's total in the quarter compared with 36% in the year-ago period.

Second Quarter Expenses

Moody's operating expenses were $282.4 million in the second
quarter of 2007, 27% higher than in the prior year period. About
two-thirds of the increase was driven by higher personnel costs while
the remaining one-third was largely driven by additional lease expense
related to Moody's headquarters move and international expansion, as
well as incremental technology investments. Moody's operating margin
for the second quarter of 2007 was 56.3%, compared with 56.5% in the
prior year period.

Second Quarter Effective Tax Rate

Moody's effective tax rate was 31.3% for the second quarter of
2007 compared with 40.6% for the prior year period. The decrease was
due primarily to the net tax benefit associated with the resolution of
certain legacy tax matters for the tax years 1997-2002. Excluding the
impacts of legacy tax matters in both periods, the tax rate for the
second quarter of 2007 was 40.0% compared to 41.1% for the prior year
period.

Year-to-date Results

Revenue for the first six months of 2007 totaled $1,229.1 million,
an increase of 29% from $951.6 million for the same period of 2006.
First half operating income of $668.4 million was up 27% from $527.4
million for the same period of 2006. Currency translation had a
positive impact on these results, increasing revenue growth by
approximately 200 basis points and operating income growth by
approximately 180 basis points. Diluted earnings per share of $1.56
for the first half of 2007 included a $0.19 per share benefit from the
resolution of certain legacy tax matters in the second quarter.
Excluding the impacts of legacy tax matters in both periods, diluted
earnings per share of $1.37 grew 28% from $1.07 for the first half of
2006.

Ratings and research revenue at Moody's Investors Service totaled
$1,155.6 million for the first six months of 2007, an increase of 31%
from the prior year period. Global ratings revenue was $1,002.6
million for the first six months of 2007, up 32% from $762.3 million
in the same period of 2006. Research revenue rose to $153.0 million
for the first half of 2007, up 25% from the first half of 2006.
Finally, revenue at Moody's KMV for the first six months of 2007
totaled $73.5 million, 9% higher than in the prior year period.

Share Repurchases

During the second quarter of 2007, Moody's repurchased 7.7 million
shares at a total cost of $500 million, which more than offset
approximately 0.8 million shares issued under employee stock-based
compensation plans. Share repurchases through the first half of 2007
were funded using a combination of excess free cash and borrowings
under Moody's $500 million revolving credit facility. As of June 30,
2007, Moody's had approximately $0.8 billion of share repurchase
authority remaining and, on Monday, July 30, 2007, Moody's Board of
Directors approved a new $2 billion share repurchase program to
commence immediately following completion of the existing program.

Assumptions and Outlook for Full Year 2007

Moody's outlook for 2007 is based on assumptions about many
macroeconomic and capital market factors, including interest rates,
corporate profitability and business investment spending, merger and
acquisition activity, consumer spending, residential mortgage
borrowing and refinancing activity and securitization levels. There is
an important degree of uncertainty surrounding these assumptions and,
if actual conditions differ from these assumptions, Moody's results
for the year may differ from the current outlook.

For Moody's overall, the Company projects that revenue growth for
the full year will meet the lower end of our previous guidance, or
mid-teens percent revenue growth for the full year 2007. This growth
assumes foreign currency translation in 2007 at current exchange
rates. Moody's expects the full-year operating margin, excluding the
one-time gain on the sale of Moody's 99 Church Street building from
2006 results, to decline by approximately 150 basis points in 2007
compared with 2006. This reflects investments to sustain business
growth including: international expansion, improving analytical
processes, pursuing ratings transparency and compliance initiatives,
introducing new products, improving technology infrastructure and
relocating Moody's headquarters in New York City. The Company expects
the quarterly spending pattern to differ from previous years, which
could result in quarterly operating margins that differ materially
from full-year expectations. Diluted earnings per share in 2007 are
now projected to be moderately higher compared to 2006. However,
excluding the one-time gain on the building sale from 2006 results and
the impacts of adjustments related to legacy tax matters in 2006 and
2007, the Company continues to project that full year 2007 diluted
earnings per share will meet our previous guidance, or low- to
mid-teens percent growth.

In the U.S., Moody's now projects low double digit percent revenue
growth for the Moody's Investors Service ratings and research business
for the full year 2007. In the U.S. structured finance business, the
Company now expects revenue for the year to rise in the mid-single
digit percent range, including low twenties percent growth in
commercial mortgage-backed securities ratings and low teens percent
growth in credit derivatives ratings, offset by a decline in revenue
from U.S. residential mortgage-backed securities ratings, including
home equity securitization, in the high-teens percent range, which is
a greater decline than previously forecast.

In the U.S. corporate finance business, Moody's continues to
expect revenue growth for the year in the mid-twenties percent range.
This assumption anticipates solid but decelerating growth from rating
corporate loans partially offset by moderately slower revenue growth
in speculative bond ratings.

In the U.S. financial institutions sector, the Company now expects
revenue to grow in the mid-teens percent range, up from previous
guidance of low-teens percent range. For the U.S. public finance
sector, Moody's continues to forecast revenue for 2007 to grow
modestly despite better performance in the first half, due to an
expected softening of issuance in certain sectors, including
healthcare, higher education and infrastructure. The Company continues
to expect growth in the U.S. research business to be about twenty
percent.

Outside the U.S., Moody's still expects ratings revenue to grow in
the low twenty percent range with high-teens to low-twenty percent
growth across all major business lines, led by growth in Europe of
structured finance and financial institutions. The Company also now
projects growth in the mid- to high-twenties percent range for
international research revenue.

For Moody's KMV globally, the Company continues to expect growth
in sales and revenue from credit risk assessment subscription
products, credit decision processing software, and professional
services. This should result in low-double-digit percent growth in
revenue with greater growth in profitability.

Moody's is an essential component of the global capital markets.
The company provides credit ratings, research, tools and analysis that
help to protect the integrity of credit. Moody's Corporation (NYSE:
MCO) is the parent company of Moody's Investors Service, which
provides credit ratings and research covering debt instruments and
securities; Moody's KMV, a provider of quantitative credit analysis
tools; Moody's Economy.com, which provides economic research and data
services; and Moody's Wall Street Analytics, a provider of software
tools and analysis for the structured finance industry. The
corporation, which reported revenue of $2.0 billion in 2006, employs
approximately 3,600 people worldwide and maintains a presence in 27
countries. Further information is available at www.moodys.com.

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Moody's Corporation
Consolidated Statements of Operations (Unaudited)

Three Months Six Months
Ended Ended
June 30, June 30,
---------------- ----------------

2007 2006 2007 2006
Amounts in millions, except per share
amounts
----------------------------------------------------- ----------------

Revenue $646.1 $511.4 $1,229.1 $ 951.6
----------------------------------------------------- ----------------

Expenses

Operating, selling, general and
administrative expenses 273.3 213.0 541.3 405.5

Depreciation and amortization 9.1 9.3 19.4 18.7

---------------- ----------------
Total expenses 282.4 222.3 560.7 424.2

----------------------------------------------------- ----------------
Operating income 363.7 289.1 668.4 527.4
----------------------------------------------------- ----------------

Interest and other non-operating
income, net 17.8 0.7 14.5 4.1

Income before provision for income
taxes 381.5 289.8 682.9 531.5

Provision for income taxes 119.6 117.7 245.6 213.2
----------------------------------------------------- ----------------

Net income $261.9 $172.1 $ 437.3 $ 318.3
----------------------------------------------------- ----------------

----------------------------------------------------- ----------------
Earnings per share
Basic $ 0.97 $ 0.60 $ 1.60 $ 1.10

Diluted $ 0.95 $ 0.59 $ 1.56 $ 1.07
----------------------------------------------------- ----------------

Weighted average shares outstanding
Basic 269.6 286.4 273.6 288.5

Diluted 276.0 293.7 280.4 296.6
----------------------------------------------------- ----------------
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Moody's Corporation
Supplemental Revenue Information (Unaudited)

Three Months Six Months
Ended Ended
June 30, June 30,
------------- -----------------

Amounts in millions 2007 2006 2007 2006

--------------------------------------------------- -----------------

Moody's Investors Service (a)

Structured finance $273.4 $216.2 $ 524.9 $ 390.6

Corporate finance 141.0 103.1 255.8 184.9

Financial institutions and sovereign
risk 83.8 66.9 160.5 132.8

Public finance 32.0 28.4 61.4 54.0
------ ------ -------- --------

Total ratings revenue 530.2 414.6 1,002.6 762.3

Research 78.0 61.9 153.0 122.1
------ ------ -------- --------

Total Moody's Investors Service 608.2 476.5 1,155.6 884.4

Moody's KMV 37.9 34.9 73.5 67.2
------ ------ -------- --------

Total revenue $646.1 $511.4 $1,229.1 $ 951.6

--------------------------------------------------- -----------------

Revenue by geographic area

United States $399.1 $328.1 $ 777.7 $ 607.0

International 247.0 183.3 451.4 344.6
------ ------ -------- --------

Total revenue $646.1 $511.4 $1,229.1 $ 951.6

--------------------------------------------------- -----------------

(a) Certain prior year amounts have been reclassified to
conform to the current year presentation.
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Moody's Corporation
Selected Consolidated Balance Sheet Data (Unaudited)

June 30, December 31,
2007 2006
------------ -------------
Amounts in millions

Cash and cash equivalents $ 361.6 $ 408.1
Short-term investments 13.4 75.4
Total current assets 918.0 1,001.9
Non-current assets 635.3 495.8
Total assets 1,553.3 1,497.7
Total current liabilities 1,090.7 700.0
Notes payable 300.0 300.0
Other long-term liabilities 428.5 330.3
Shareholders' (deficit) equity (265.9) 167.4
Total liabilities and shareholders' equity $ 1,553.3 $ 1,497.7

Shares outstanding 266.9 278.6
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"Safe Harbor" Statement under the Private Securities Litigation
Reform Act of 1995

Certain statements contained in this release are forward-looking
statements and are based on future expectations, plans and prospects
for Moody's business and operations that involve a number of risks and
uncertainties. The forward-looking statements and other information
are made as of August 1, 2007, and the Company disclaims any duty to
supplement, update or revise such statements on a going-forward basis,
whether as a result of subsequent developments, changed expectations
or otherwise. In connection with the "safe harbor" provisions of the
Private Securities Litigation Reform Act of 1995, the Company is
identifying certain factors that could cause actual results to differ,
perhaps materially, from those indicated by these forward-looking
statements. Those factors include, but are not limited to, matters
that could affect the volume of debt securities issued in domestic
and/or global capital markets, including credit quality concerns,
changes in interest rates and other volatility in the financial
markets; possible loss of market share through competition;
introduction of competing products or technologies by other companies;
pricing pressures from competitors and/or customers; the potential
emergence of government-sponsored credit rating agencies; proposed
U.S., foreign, state and local legislation and regulations;
regulations relating to the oversight of Nationally Recognized
Statistical Rating Organizations; possible judicial decisions in
various jurisdictions regarding the status of and potential
liabilities of rating agencies; the possible loss of key employees to
investment or commercial banks or elsewhere and related compensation
cost pressures; the outcome of any review by controlling tax
authorities of the Company's global tax planning initiatives; the
outcome of those tax and legal contingencies that relate to Old D&B,
its predecessors and their affiliated companies for which the Company
has assumed portions of the financial responsibility; the outcome of
other legal actions to which the Company, from time to time, may be
named as a party; the ability of the Company to successfully integrate
acquired businesses; a decline in the demand for credit risk
management tools by financial institutions; and other risk factors as
discussed in the Company's annual report on Form 10-K for the year
ended December 31, 2006 and in other filings made by the Company from
time to time with the Securities and Exchange Commission.