When S&P Global (SPGI +0.17%), one of the world's largest financial data companies, posted its first-quarter earnings report on April 28, many investors focused on the recently spin-off of its Mobility unit, which provides automotive data, into a new company that will start trading independently on July 1. That divestment should streamline S&P Global's core business, while freeing up more resources to upgrade its generative AI services for analyzing financial data.
However, fewer investors seemed to notice its 25% year-over-year growth in Private Credit revenue in its Ratings segment. That outpaced the company's 10% growth in adjusted revenue for the quarter, and gives investors a much clearer look into the private credit market.
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Why does private credit matter to S&P Global?
S&P Global's Ratings business, which accounted for 31% of its top line in the first quarter, traditionally rates public corporate bonds and broadly syndicated loans (BSLs). But over the past two decades, it expanded its services into the multi-trillion-dollar private credit market.
That expansion reduced its dependence on traditional public debt issuance, which is heavily influenced by fluctuating interest rates. Private credit lenders are often better insulated from those headwinds, since mid-market companies and private equity firms still turn to direct lenders (rather than conventional banks) to quickly secure more funds through choppy market cycles.
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Private investors are also keeping rapidly growing companies private for longer periods instead of going public through traditional IPOs. That structural shift drives up the demand for private credit rating services, which give investors deeper insights into these opaque companies.
By providing these specialized risk assessments, S&P Global positions itself as a "data tollbooth" that serves institutional investors and regulators in this murky market. It also widens its moat against its potential AI-powered challengers in the financial data analysis market, since private investors are less likely to trust smaller companies to crunch all of their data.
What does S&P Global's private revenue growth mean for investors?
S&P Global generated "north of $600 million" in revenues from the private markets (including its ratings) in 2025. That only accounted for about 4% of its total revenue, but it's one of its fastest-growing businesses. Its growth also reinforces the idea that S&P Global is an evergreen company that can keep expanding through bull and bear markets -- since its clients will still need to access its analytics and credit rating services even if the economy contracts.
