Fair Isaac — Financial Results

Scores Segment Is Driving the Business, Growing 27% to $1.2 Billion

The Scores segment — which includes the FICO Score sold to lenders — is the clear engine of growth, now making up 59% of total revenue (up from 54% the prior year). Growth was driven by higher prices per score, more mortgage originations, and a large multi-year license renewal on an insurance scoring product. Margins held rock-steady at 88%, meaning almost every dollar of new Scores revenue flows straight to the bottom line.

Overall Profitability Improved Meaningfully Across the Board

Revenue grew 16% but profits grew faster — a sign that the business is becoming more efficient. Operating margin (profit as a share of revenue) expanded from 43% to 46%, largely because high-margin Scores revenue grew much faster than costs. Diluted EPS (earnings per share, accounting for all shares) grew even faster than net income, partly because share buybacks reduced the share count.

Software Segment Growing Slowly, With Platform Gaining Ground on Older Products

The Software segment grew revenue only 3% and actually saw operating profit dip 4%, as rising infrastructure and staffing costs outpaced revenue gains. Within Software, the modern FICO Platform products are growing well (+16% in annualized recurring revenue), but older non-platform products are slowly shrinking (-2%). The Dollar-Based Net Retention Rate (a measure of whether existing customers are spending more or less over time) sits at 102% overall — meaning the company is just barely growing revenue from its existing customer base.

Debt Load Rose Significantly to Fund Buybacks

In May 2025, FICO issued $1.5 billion of new senior notes (fixed-rate bonds) at 6.0% interest, using the proceeds to pay off existing variable-rate loans and expand its revolving credit line to $1.0 billion. The net effect is that total debt grew by nearly $900 million in one year. This borrowing largely funded an aggressive share repurchase program — the company bought back $1.4 billion of its own stock in FY2025 alone. Interest expense rose 27% to $133.6 million as a result.

A Late-Year Restructuring Trimmed 226 Positions

In the fourth quarter of FY2025, FICO eliminated 226 jobs — roughly 6% of its ~3,800-person workforce — incurring $10.9 million in restructuring charges (one-time severance costs). All cash payments are expected to be made by the end of FY2026. The filing does not specify which functions were affected, but the action suggests management is actively managing its cost base, particularly as Software segment margins face pressure.