FICO reported fourth‑quarter 2025 results that included GAAP net income of $155 million, or $6.42 per share, and non‑GAAP net income of $187 million, or $7.74 per share. Revenue reached $516 million, up 14% year‑over‑year, beating consensus estimates of $511.78 million by $4.2 million (0.8%). The earnings beat was driven by a 25% increase in the Scores segment, which generated $312 million in revenue, while the Software segment remained flat at $204 million. The strong Scores performance was supported by higher demand for B2B and B2C credit‑scoring solutions, and the company’s AI‑powered platform attracted new enterprise customers, contributing to a 17% rise in platform revenue.
The quarter’s revenue growth was offset by a $10.9 million pre‑tax restructuring charge, which was included in GAAP net income but excluded from non‑GAAP figures. After the charge, GAAP net income was $155 million; without the charge, GAAP net income would have been $165.9 million. The restructuring effort, aimed at streamlining operations and reducing legacy costs, is expected to improve operating margins in future periods. The charge’s impact explains why GAAP EPS of $6.42 fell short of the $7.34 consensus estimate, while non‑GAAP EPS of $7.74 surpassed the estimate by $0.40 (5.5%).
Management highlighted that the company’s free‑cash‑flow generation remained robust, with FY2025 free cash flow reaching $200 million, up 16% from the prior year. CEO Will Lansing emphasized that the company is “exceeding fiscal 2025 guidance on all metrics” and that the FY2026 guidance reflects confidence in continued growth. FY2026 revenue guidance is $2.35 billion, an 18% increase over FY2025, while GAAP EPS guidance is $33.47 and non‑GAAP EPS guidance is $38.17. These guidance figures are below analyst expectations, which may temper investor enthusiasm despite the strong Q4 performance.
The company’s strategic focus on AI and its FICO Platform has driven higher-margin contracts and platform ARR growth, offsetting flat software revenue. Direct licensing initiatives for mortgage originations are expanding the company’s market reach and pricing flexibility. The Scores segment’s 25% revenue growth demonstrates the resilience of FICO’s core credit‑scoring business, while the flat Software segment indicates a need to accelerate product innovation to maintain momentum.
Investors weighed the Q4 earnings beat against the FY2026 guidance, which fell short of some analyst estimates. The mixed reaction reflects confidence in current operational execution but caution about the company’s future growth trajectory.
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