On this page of StockholderLetter.com we present the latest annual shareholder letter from FAIR ISAAC CORP — ticker symbol FICO. Reading current and past FICO letters to shareholders can bring important insights into the investment thesis.

 •  1/27/2026 Letter Continued (Full PDF)
 •  1/25/2023 FICO Stockholder Letter
 •  1/10/2024 FICO Stockholder Letter
 •  1/27/2025 FICO Stockholder Letter
 •  More "Business Services & Equipment" Category Stockholder Letters
 •  FICO Benford's Law Stock Score = 88

FICO Shareholder/Stockholder Letter Transcript:

FAIR ISAAC CORPORATION
2025 ANNUAL REPORT

Dear Shareholders:
FICO had another successful year. We exceeded fiscal year 2025 guidance on all metrics and delivered
record annual free cash flow of $739 million*, an increase of 22% year over year. We delivered
revenues of $1.99 billion, up 16% from the prior year. GAAP net income reached $652 million or
$26.54 of earnings per share, up 27% and 30%, respectively, from fiscal 2024. We continued to return
capital to our shareholders, repurchasing $1.4 billion in shares.
Our performance in fiscal 2025 was driven by both our Scores and Software operating segments. The
growth of our Scores segment was a result of our innovation, industry leadership and the continued
success of the FICO   Score as the standard measure of consumer credit risk in the U.S. The success in
our Software segment was primarily due to strong results related to FICO   Platform, our integrated
cloud platform that enables clients to make smarter business decisions at scale, powered by AI and
advanced analytics.
Scores
In our Scores segment, our revenues were $1.169 billion, up 27% versus last year, primarily driven by
B2B Scores.
The FICO   Score, used by 90% of top U.S. lenders, remains the standard for use in mortgage underwriting
and pricing, investor credit risk and prepayment models, capital requirements, credit agency ratings, and
pricing of mortgage-backed securities. It is the only score that has performance data through the Great
Recession, and the only score that is widely leveraged throughout secondary mortgage markets.
On October 1, 2025, we announced the strategic decision to launch the FICO   Mortgage Direct License
Program, giving tri-merge resellers the option to calculate and distribute FICO   Scores directly to their
customers. This expands our distribution channel beyond the three nationwide credit bureaus. We believe
this program will drive competition, transparency, and cost savings in mortgage lending, while aligning
with calls from policymakers and industry leaders to modernize credit infrastructure and promote
affordability, liquidity, and access in the $12 trillion U.S. mortgage industry.
There has been overwhelming interest in the FICO   Mortgage Direct License Program since its
announcement, including a multi-year direct license and distribution agreement with Xactus, the largest
credit verification and tri-merge provider of FICO   Scores. We are actively engaged with resellers
representing approximately 80% of mortgage volume, including the largest tri-merge resellers, as well
as technology platform providers that serve the smaller tri-merge resellers.
Our consistent innovation is increasingly recognized by the market. We continue to see growing
momentum and adoption of FICO   Score 10T, the most predictive credit scoring model on the market,
with enhanced risk assessment capabilities that benefit lenders, mortgage insurers, investors, and other
market participants. Nine of the top fifteen mortgage lenders, who cover hundreds of billions of dollars
in loan originations, have signed agreements for FICO Score 10T. In December, we announced we
reached agreement on terms and conditions for the Government Sponsored Enterprises to release FICO
Score 10T historical data allowing conforming mortgage lenders, investors, third party risk modelers,
and other stakeholders to soon be able to conduct their own analyses and comparisons of FICO
Score 10T.

This year, we partnered with Plaid to deliver the next generation of the UltraFICO   Score, which
utilizes cash flow data to provide additional information for lending decisions. We also announced
FICO   Score 10 BNPL and FICO   Score 10T BNPL, the first credit scores from a leading credit
scoring provider to incorporate Buy Now, Pay Later (BNPL) data. These innovative scores, developed
by FICO from data-driven research, give lenders deeper insight into how consumers manage
repayment on increasingly popular installment loans.
Software
In our Software segment, we delivered $822 million in revenue, up 3% from last year, driven by 19%
growth in FICO   Platform. Our annual contract value bookings reached $102 million, an increase of
21% versus prior year, and our strongest annual performance to date.
Over the past decade, our software development has centered on the accelerated growth of FICO   Platform.
Our Software business continues to grow as more financial institutions adopt FICO Platform and existing
customers expand to new uses cases across additional decisioning areas. Today we serve over 150 Platform
customers, with nearly half still in the early stages of expanding beyond their initial use case.
This was an important year for FICO   Platform innovation, as we announced major developments:
Next Generation FICO Platform, FICO   Enterprise Fraud Solution, and FICO   Marketplace. These
innovations will deliver a connected end to end customer experience, bring new use cases to the
market, enable smarter explainable outcomes, improve performance, improve speed of deployment,
and yield better customer Return on Investment. We also announced FICO   Focused Foundation
Model for Financial Services. These models deliver greater accuracy and cost efficiency compared to
traditional generative AI models.
The strength of our innovations was recognized this year in several analyst reports and industry
awards, including    The Forrester Wave: AI Decisioning Platforms, Q2 2025 Report,    where we have
achieved leader position in every edition of the report since it was created. Our analytic innovations at
FICO are protected by various forms of intellectual property, including our patent portfolio of more
than 230 issued patents and nearly 80 pending applications.
In summary, FICO continues to drive market innovation, resulting in near-term growth in fiscal 2025
and a positive outlook for fiscal 2026. Our strategies align with the market   s demand for responsible
AI, greater customer centricity, and more powerful predictive solutions to further industry stability and
resilience. The FICO team has once again demonstrated why we remain an industry leader, one of the
strongest performers in the market, and a champion for innovation that delivers results.
William J. Lansing, CEO

This letter refers to the non-GAAP financial measure free cash flow. For a reconciliation of this non-GAAP financial measure to its most
comparable GAAP measure, please refer to our earnings release for the fourth quarter of fiscal 2025, as filed with the SEC as Exhibit
99.1 to our Current Report on Form 8-K, dated November 5, 2025, and available at www.sec.gov.



 1/27/2026 Letter Continued (Full PDF)