FICO(US:FICO)2020-01-31 00:52Financial Data and Key Metrics Changes - The company reported revenues of $299 million, an increase of 14% over the same period last year [7] - GAAP net income was $55 million, up 37%, with GAAP earnings of $1.82, up 38% [7] - Non-GAAP earnings per share were $1.80, up 24% from last year, and free cash flow grew by 27% from fiscal 2019 [8] - Non-GAAP operating margin was 27% for the quarter, with GAAP net income of $55 million, up 37% from the prior year [23] Business Line Data and Key Metrics Changes - Applications revenues were $152 million, up 3% from the same period last year, driven by higher professional services and usage-based software revenues [17] - Decision Management Software (DMS) segment revenues were $31 million, up 8% over the same period last year, with DMS bookings at $49 million, up 56% from the previous year [18] - Scores segment revenues were $115 million, up 34% from the prior year, with B2B revenues up 46% and B2C revenues up 11% [19] Market Data and Key Metrics Changes - 76% of total revenues were derived from the Americas region, 16% from EMEA, and 8% from Asia Pacific [19] - Recurring revenues from transactional and maintenance sources represented 74% of total revenues [20] Company Strategy and Development Direction - The company is focused on delivering innovation and growth across its portfolio, particularly in the Scores business and software solutions [7][29] - Plans to turn APIs outward-facing to enable customization by partners and expand into verticals beyond financial services [36][38] - The company aims to build shareholder value while improving efficiency and serving customer needs [29] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's positioning for success in 2020 and beyond, particularly in the Scores business [29] - The company anticipates that the benefits from restructuring actions will materialize in the second quarter and beyond [46] Other Important Information - The company issued $350 million of callable notes, maturing in 2028, to repay a portion of its revolving credit facility [27] - The effective tax rate for the quarter was negative 31% due to excess tax benefits from stock-based compensation [24] Q&A Session Summary Question: Details on strong license revenue in Scores business - Management indicated that a larger deal structured as a license contributed to the revenue spike but advised not to read too much into it [32] Question: Special price increases in Scores business - Management confirmed that a special price increase was implemented in January, but results are still being assessed [33] Question: Plans for outward-facing APIs - Management plans to make APIs outward-facing within an 18 to 24-month timeframe to enhance customization and expand into new verticals [36] Question: SaaS bookings decline - Management explained that the decline in SaaS bookings is typical for the seasonally slowest quarter and does not indicate long-term issues [40] Question: Adoption of FICO Score 10 and 10T by GSEs - Management expects these scores to be considered but could not provide a specific timeline for adoption [41] Question: Performance of application, transaction, and maintenance revenues - Management stated that muted growth is by design as the company transitions to a multi-tenant platform [49]