FICO(US:FICO)2025-04-29 20:15Financial Performance - Total revenues for the quarter ended March 31, 2025, were $498.7 million, a 15% increase from $433.3 million in the same quarter of 2024[71] - Revenues for the Scores segment were $297.0 million during the quarter ended March 31, 2025, a 25% increase from $237.6 million in the same quarter of 2024[71] - Annual Recurring Revenue (ARR) for the Software segment as of March 31, 2025, was $714.6 million, a 3% increase from $693.0 million as of March 31, 2024[71] - Operating income for the quarter ended March 31, 2025, was $245.6 million, a 26% increase from $194.8 million in the same quarter of 2024[71] - Net income for the quarter ended March 31, 2025, was $162.6 million, a 25% increase from $130.0 million in the same quarter of 2024[71] - Diluted EPS for the quarter ended March 31, 2025, was $6.59, a 28% increase from $5.15 in the same quarter of 2024[71] Cash Flow and Debt - Cash flows from operating activities for the six months ended March 31, 2025, were $268.9 million, compared to $193.2 million for the same period in 2024[71] - Total debt balance was $2.5 billion as of March 31, 2025, an increase from $2.2 billion as of September 30, 2024[71] - Cash and cash equivalents as of March 31, 2025, totaled $146.6 million, including $100.4 million held by foreign subsidiaries, sufficient to meet capital requirements for at least the next 12 months[111] - Net cash provided by operating activities increased to $268.9 million for the six months ended March 31, 2025, up from $193.2 million, driven by a $64.3 million increase in net income[115] - Net cash used in investing activities increased to $19.9 million for the six months ended March 31, 2025, from $12.0 million for the same period in 2024, primarily due to an $8.3 million increase in capitalized internal-use software costs[116] - Net cash used in financing activities rose to $247.7 million for the six months ended March 31, 2025, compared to $183.2 million for the same period in 2024, driven by a $136.3 million increase in common stock repurchases[117] Expenses and Operating Metrics - Research and development expenses for the quarter increased by $4.2 million, remaining consistent at 9% of revenues[90] - Cost of revenues as a percentage of revenues decreased to 18% for the quarter ended March 31, 2025, down from 20% in the prior year[87] - Total operating expenses for the quarter were $253.1 million, a 6% increase from $239.0 million in the same quarter of 2024[85] - Selling, general and administrative expenses increased by $9.6 million year-over-year, with personnel and labor costs rising by $5.9 million and advertising expenses increasing by $3.6 million; however, these expenses as a percentage of revenues decreased from 26% to 24%[93] - Year-to-date selling, general and administrative expenses rose by $33.2 million, driven by an $18.5 million increase in personnel costs and a $10.3 million increase in advertising costs, while the percentage of revenues decreased from 27% to 26%[94] Segment Performance - Scores segment revenues increased by $60.2 million to $297.0 million, driven by a $57.0 million increase in business-to-business scores revenue[81] - Software segment revenues increased by $4.8 million to $201.7 million, primarily due to a $6.6 million increase in on-premises and SaaS software revenue[82] - Scores segment operating income increased by $52.8 million, resulting from a $60.2 million rise in segment revenue, maintaining an operating income margin of 89%[103] - Operating income for the quarter increased by $50.8 million, attributed to a $64.9 million rise in segment revenues, while total segment operating income rose by 25%[101] - Year-to-date operating income increased by $78.976 million, primarily due to a $122.8 million rise in segment revenues, with total segment operating income up by 23%[106] Tax and Interest - The effective income tax rate improved to 23.7% for the quarter ended March 31, 2025, down from 24.9% in the prior year, positively impacted by excess tax benefits from share-based compensation[100] - Interest expense increased by $5.3 million for the quarter, primarily due to a higher average outstanding balance on borrowings, despite a lower average interest rate[96] Stock and Financing Activities - Total share repurchases during the quarter ended March 31, 2025, were $207.0 million, compared to $179.5 million in the same quarter of 2024[71] - The company has a new stock repurchase program authorized for up to $1.0 billion, with $394.1 million remaining as of March 31, 2025, after expending $366.8 million under the program in the six months ended March 31, 2025[118] Risk Management - The company is exposed to market risk related to changes in interest rates and foreign exchange rates, with no use of derivative financial instruments for speculative purposes[126] - The company has foreign currency forward contracts to manage exchange rate risk, with a contract amount of €8,500 and £16,026 as of March 31, 2025[130]