Credit scoring and analytics company FICO (NYSE: FICO) beat Wall Street’s revenue expectations in Q4 CY2025, with sales up 16.4% year on year to $512 million. On the other hand, the company’s full-year revenue guidance of $2.35 billion at the midpoint came in 3.7% below analysts’ estimates. Its non-GAAP profit of $7.33 per share was 3.5% above analysts’ consensus estimates.
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Fair Isaac Corporation (FICO) Q4 CY2025 Highlights:
- Revenue: $512 million vs analyst estimates of $502.7 million (16.4% year-on-year growth, 1.8% beat)
- Adjusted EPS: $7.33 vs analyst estimates of $7.08 (3.5% beat)
- Adjusted EBITDA: $282.3 million vs analyst estimates of $270 million (55.1% margin, 4.6% beat)
- The company reconfirmed its revenue guidance for the full year of $2.35 billion at the midpoint
- Operating Margin: 45.7%, up from 40.8% in the same quarter last year
- Free Cash Flow Margin: 32.3%, down from 42.5% in the same quarter last year
- Market Capitalization: $36.72 billion
Company Overview
Creator of the three-digit number that can determine whether you get a mortgage or credit card, Fair Isaac Corporation (NYSE: FICO) develops analytics software and the widely used FICO Score, which is the standard measure of consumer credit risk in the United States.
Revenue Growth
Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can put up a good quarter or two, but many enduring ones grow for years.
With $2.06 billion in revenue over the past 12 months, Fair Isaac Corporation is a mid-sized business services company, which sometimes brings disadvantages compared to larger competitors benefiting from better economies of scale. On the bright side, it can still flex high growth rates because it’s working from a smaller revenue base.
As you can see below, Fair Isaac Corporation’s sales grew at an impressive 9.5% compounded annual growth rate over the last five years. This is a great starting point for our analysis because it shows Fair Isaac Corporation’s demand was higher than many business services companies.
Long-term growth is the most important, but within business services, a half-decade historical view may miss new innovations or demand cycles. Fair Isaac Corporation’s annualized revenue growth of 15.3% over the last two years is above its five-year trend, suggesting its demand was strong and recently accelerated. 
This quarter, Fair Isaac Corporation reported year-on-year revenue growth of 16.4%, and its $512 million of revenue exceeded Wall Street’s estimates by 1.8%.
Looking ahead, sell-side analysts expect revenue to grow 24.6% over the next 12 months, an improvement versus the last two years. This projection is eye-popping and implies its newer products and services will spur better top-line performance.
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Operating Margin
Fair Isaac Corporation has been a well-oiled machine over the last five years. It demonstrated elite profitability for a business services business, boasting an average operating margin of 43%.
Looking at the trend in its profitability, Fair Isaac Corporation’s operating margin rose by 7.8 percentage points over the last five years, as its sales growth gave it immense operating leverage.
This quarter, Fair Isaac Corporation generated an operating margin profit margin of 45.7%, up 4.9 percentage points year on year. This increase was a welcome development and shows it was more efficient.
Earnings Per Share
Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.
Fair Isaac Corporation’s EPS grew at an astounding 24% compounded annual growth rate over the last five years, higher than its 9.5% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.
We can take a deeper look into Fair Isaac Corporation’s earnings quality to better understand the drivers of its performance. As we mentioned earlier, Fair Isaac Corporation’s operating margin expanded by 7.8 percentage points over the last five years. On top of that, its share count shrank by 19.6%. These are positive signs for shareholders because improving profitability and share buybacks turbocharge EPS growth relative to revenue growth. 
Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.
For Fair Isaac Corporation, its two-year annual EPS growth of 24.6% is similar to its five-year trend, implying strong and stable earnings power.
In Q4, Fair Isaac Corporation reported adjusted EPS of $7.33, up from $5.79 in the same quarter last year. This print beat analysts’ estimates by 3.5%. Over the next 12 months, Wall Street expects Fair Isaac Corporation’s full-year EPS of $31.45 to grow 41.5%.
Key Takeaways from Fair Isaac Corporation’s Q4 Results
It was encouraging to see Fair Isaac Corporation beat analysts’ revenue expectations this quarter. We were also glad its EPS outperformed Wall Street’s estimates. On the other hand, its full-year revenue guidance missed. Overall, this quarter could have been better. The stock traded up 1.8% to $1,553 immediately following the results.
Big picture, is Fair Isaac Corporation a buy here and now? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here (it’s free).
