Fair Isaac (FICO) delivered a solid QQ3 2024 with revenue of $447.8 million, up 12% year over year, underpinned by strength in the Scores segment (notably mortgage-originations revenue) and continued growth in the Software segment driven by SaaS adoption. Platform ARR expanded 31% year over year to $215 million, representing 30% of total software ARR, while total ARR rose 10% to $710 million. Net retention remained robust at 108% overall (platform 124%, non-platform 101%), underscoring a land-and-expand strategy that drives usage and expansion within existing customers. Free cash flow hit a record $206 million for the quarter, and trailing twelve-month FCF reached $551 million, supporting a sustainable capital return program and meaningfully deleveraging opportunities over time. Management raised full-year guidance, signaling confidence in continued platform adoption and resilient demand for FICO’s analytic software and credit decisioning solutions.
Key takeaways for investors include: (1) platform-led growth remains the core growth engine, with ACV bookings at $27.5 million in Q3 and Platform ARR up 31% YoY; (2) mortgage-originations revenue in Scores is a meaningful contributor to B2B growth, but mortgage volumes are a lagging and somewhat volatile input; (3) the company remains disciplined on margins in the near term (GAAP vs non-GAAP), guiding to a higher full-year revenue target of $1.70 billion and non-GAAP EPS of $23.16 despite quarterly margin fluctuations; (4) ample liquidity and buyback capacity, including a new $1 billion board authorization, support capital returns while maintaining optionality on debt management and potential further platform investments.