Fair Isaac (FRI) Q3 2026 Earnings Report

The call highlights very strong financial performance (double-digit revenue and earnings growth), robust cash generation, record capital returns, and accelerating platform momentum and ARR — all of which drove an upward revision to FY guidance. Counterbalancing these positives are sector-specific headwinds (soft mortgage volumes due to higher rates), declines in legacy/non-platform revenues and professional services, elevated leverage with higher near-term interest expense, and ongoing competitive/operational risks (GSE certification delay for the DLP and score-shopping pressure from VantageScore). Overall, the positives (revenue/earnings growth, platform adoption, cash generation and strategic partnerships) outweigh the challenges, but there are clear near-term risks to monitor.

FICO raised fiscal 2026 guidance to revenue of $2.53 billion (up ~20% y/y), GAAP net income of $850 million (up ~30%) and GAAP EPS of $36.86 (up ~39%), and non‑GAAP net income of $979 million (up ~33%) with non‑GAAP EPS of $42.43 (up ~42%); management also guided to a full‑year operating tax rate of 25–26% (effective tax rate ~24%), said Q4 operating expenses will be modestly higher (front‑loaded marketing for the Accenture partnership plus some one‑time restructuring), expects Q4 interest expense to be higher following a $1.5 billion term loan (total debt $5.58 billion at a 5.64% weighted average rate, cash and marketable investments $305 million), plans near‑term debt paydown while continuing to view buybacks as attractive after Q3 repurchases of $1.96 billion (1.705 million shares at an average $1,149), and noted strong cash generation (Q3 free cash flow $370 million; trailing four‑quarter FCF $961 million, +28%).