By Reuters | Updated: November 6, 2024
Nov 6 (Reuters) – FICO (FICO.N) reported a better-than-expected fourth-quarter profit on Wednesday, thanks to strong demand for its credit-scoring products.
Analysts expect an uptick in loan demand as the U.S. Federal Reserve lowers borrowing costs through 2025, benefiting companies like FICO, which rely on lenders assessing customer creditworthiness before approving loans.
Rising delinquencies have also led banks to tighten lending standards, prompting stricter customer checks.
The company reported adjusted profit of $163.2 million, or $6.54 per share, in the fourth quarter ended Sept. 30. That compares with $126.7 million, or $5.01 per share, a year earlier.
Analysts on average had expected FICO to earn $6.39 per share, according to estimates compiled by LSEG.
Scores revenue, which includes its business-to-business and business-to-consumer solutions, rose to $249.2 million in the fourth quarter, compared with $195.6 million a year earlier.
Software revenue climbed 5% to $204.6 million in the quarter. FICO’s revenue jumped 16% to $453.8 million from a year earlier.
The company is best known for its FICO Score, the standard measure of consumer credit risk used by banks, credit card issuers, mortgage lenders and auto loan providers.
Its customers include U.S. banking giant Wells Fargo (WFC.N), opens new tab as well as the top 100 U.S. credit card issuers.
FICO sees full-year 2025 revenue of about $1.98 billion, in line with analysts’ expectation.
The company forecast adjusted profit of $28.58 per share for the year, below estimates of $29.80.
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@ Thomson Reuters 2024
