[EFX] Equifax: Q3 2026 earnings preview as verification growth slows

Equifax (EFX) is one of the three U.S. consumer credit bureaus and also runs The Work Number, an income and employment verification platform; it sells credit reports, scores, verifications and fraud data per transaction to banks, mortgage lenders, government agencies and employers[1][2]. Ahead of its Q3 2026 earnings, the earnings calendar shows Equifax holding its call on 2026-10-20 to report results for the quarter ending September 30, 2026[3]. In the latest disclosed quarter, the second quarter of 2026, revenue was $1.700 billion, up 11% reported and 10% in constant currency[4]; adjusted EPS was $2.25, up 13%, and the adjusted EBITDA margin was 32.5%, flat year over year[5]; U.S. mortgage revenue rose 25%, while the largest segment, Workforce Solutions (EWS), grew only 7%[4]. On July 21 the company guided third-quarter revenue to $1.680 billion to $1.710 billion (8.7% to 10.7% reported growth) and adjusted EPS to $2.15 to $2.25, with full-year revenue of $6.710 billion to $6.780 billion and adjusted EPS of $8.39 to $8.69[6]; on the call management added third-quarter adjusted EBITDA guidance of $547 million to $564 million, an EBITDA margin excluding FICO mortgage-score royalties of 34.6% to 35.0%, and full-year free cash flow above $1 billion[7]. Thirteen analysts compiled by Drillr average $1.690 billion of third-quarter revenue (range $1.670 billion to $1.700 billion), and 14 analysts average EPS of $2.204 (range $2.134 to $2.264)[8]; for the full year the averages are $6.730 billion of revenue and $8.52 of EPS, with revenue slightly below the midpoint of company guidance[9].

Three things matter most in the third-quarter report. The first is whether EWS can reaccelerate: Verification Services growth slowed from 14% in the first quarter to 7% in the second because government benefit-verification revenue fell 4%[10][11], and since EWS contributes about 47% of adjusted EBITDA, whether government stops declining in the third quarter will show if the slowdown was a comparison issue or weaker demand[11]. The second is the quality of U.S. mortgage revenue: USIS (U.S. Information Solutions) mortgage revenue rose 40% in the second quarter but only about mid-single digits after removing royalties passed through to FICO[11], and the company still guides full-year mortgage revenue growth just above 20% despite weaker originations[7], so the quarter will show how much of that growth belongs to Equifax itself. The third is the cash payoff from finishing the cloud migration: first-half capital spending was $255 million, up $26 million year over year, and free cash flow was about $326 million[12][13]; reaching the promised full-year figure above $1 billion requires about $674 million in the second half, and third-quarter capex and the margin excluding FICO will be the first reading[7].

Company Background and Business Structure

Equifax is a global credit and verification company built on proprietary data, and the U.S. accounted for 77% of its 2025 revenue[14]. Headquartered in Atlanta, it had about 15,000 employees in 22 countries at the end of 2025, including about 3,100 in EWS, 2,800 in USIS, 4,800 in International and 4,300 in corporate Centers of Excellence[15]. It owns two core assets. One is its U.S. consumer credit file, which sits alongside those of Experian and TransUnion; mortgage lenders use a tri-merge credit report that combines data from all three bureaus[16]. The other is The Work Number: payroll data from over 4 million organizations flows to Equifax, which answers income and employment verification requests from lenders, governments and employers on the employers' behalf[2]. Over the past several years the company has spent nearly $3 billion moving its systems to the cloud[17], and its 10-K says it is in the final stages of migrating the vast majority of applications and infrastructure off legacy systems[18].

Equifax reports three segments, and EWS is the largest by both revenue and profit. In 2025 EWS had revenue of $2.582 billion and operating income of $1.142 billion, USIS had revenue of $2.079 billion and operating income of $475 million, and International had revenue of $1.414 billion and operating income of $183 million, for combined segment revenue of $6.075 billion and segment operating income of $1.799 billion[19]; EWS was 43% of revenue, and the largest foreign operations are in Australia, the U.K. and Canada[20]. EWS consists of Verification Services and Employer Services, the latter covering unemployment claims management, I-9 onboarding, Affordable Care Act compliance and tax credits; USIS consists of Online Information Solutions, which sells credit reports, scores, identity management, fraud detection and consumer monitoring per transaction, and Financial Marketing Services[1]. In 2025 Verification Services revenue was $2.180 billion and Employer Services $403 million, while Online Information Solutions was $1.821 billion and Financial Marketing Services $257 million[21].

The business chain takes data in from customers and employers and sells products out by the transaction, and mortgage activity moves both U.S. segments at once. Verification Services customers include government agencies, mortgage originators, card and auto lenders and pre-employment screeners[22]; USIS mortgage products are the tri-merge report and alerts on changes in a borrower's credit during underwriting[16]. Revenue is recognized as transactions and subscriptions, which makes seasonality clear: USIS online consumer services are lowest in the first quarter, Employer Services is higher in the first quarter because of 1095-C forms, and some Financial Marketing Services products are higher in the fourth quarter[23]. In July 2026 the company agreed to buy the Mexican credit bureau Círculo de Crédito for an enterprise value of $750 million (a purchase price of $825 million, net of an estimated $75 million of acquired cash), with closing expected in the fourth quarter[24].

Financial History and Current Position

Equifax has grown revenue steadily over the past three years, but its operating margin has stayed around 18%. Revenue was $5.265 billion, $5.681 billion and $6.075 billion in 2023 through 2025, operating income was $934 million, $1.042 billion and $1.095 billion, and operating margin was 17.7%, 18.3% and 18.0%; net income attributable to Equifax was $545 million, $604 million and $660 million, or $4.40, $4.84 and $5.32 per diluted share[25]. Revenue rose 7% in 2025 with contributions from all three segments, and currency reduced revenue by $21.7 million[26]; cost of services rose $127 million that year, mainly from higher royalty, revenue share and purchased data costs[27].

Cash flow changed more visibly than profit, with capital spending falling as the cloud migration neared completion. In 2025 operating cash flow was $1.616 billion and capex was $481 million, down from $601 million in 2023[25]; depreciation and amortization was $727 million, and the company bought back $928 million of stock and paid $233 million of dividends[28]. In April 2025 the board approved a $3 billion buyback authorization, with about $2.1 billion remaining at year-end[29].

Revenue accelerated in the first half of 2026, but profit and cash flow did not improve at the same pace. First-quarter revenue was $1.649 billion, up 14% and $37 million above the midpoint of February guidance[30], with operating income of $288 million and adjusted EBITDA of $477 million, a 29.0% margin[31]. Second-quarter revenue was $1.700 billion and operating income was $314 million, an 18.5% operating margin versus 20.2% a year earlier[32], which included a $100 million legal settlement accrual that, net of $60 million of expected insurance proceeds, produced a $40 million charge[33]. Second-quarter net income attributable to Equifax was $184 million, down 4%, or $1.54 per diluted share[34]. First-half operating cash flow was $582 million, essentially flat with $585 million a year earlier, capex was $255 million, buybacks were $560 million and dividends were $134 million[13][35]; at June 30 cash was $170 million[36] and total debt was $5.485 billion, including $1.397 billion of commercial paper[37]. In July the company issued $1 billion of senior notes, with net proceeds of about $991 million used to repay commercial paper[38][39].

Operating Model

Equifax's revenue breaks into three per-transaction fee streams, and mortgage is the most volatile variable among them. EWS verification revenue is roughly request volume times record hit rate times price, with mortgage, government, talent and consumer lending as the four customer groups; USIS online revenue is roughly inquiry volume times price, and the price of a mortgage report includes the FICO score royalty that is passed through; International revenue comes from local credit businesses in Latin America, Europe, Asia Pacific and Canada and moves with currency[1][16]. In the second quarter of 2026 EWS revenue was $705 million (up 7%), made up of $608 million of Verification Services and $98 million of Employer Services (up 3%)[10]; USIS revenue was $612 million (up 17%), with Online Information Solutions at $545 million (up 19%) and Financial Marketing Services at $66 million (up 4%); International revenue was $383 million, up 8% reported and 4% in constant currency[40]. In the same quarter U.S. mortgage revenue grew 25%, while what the company calls diversified markets, its non-mortgage business, grew 6% in constant currency[4].

On the profit side, marginal costs differ sharply by segment, and FICO royalties push revenue and margin in opposite directions. Cost of services consists mainly of data acquisition, royalties and revenue share, plus database maintenance, cloud computing and customer support[41]. The main marginal cost in EWS is revenue share paid to some data partners; its second-quarter adjusted EBITDA margin was 52.1%, down from 53.3%[34], and the 10-Q attributes the lower operating margin to higher revenue share and amortization of software capitalized during the cloud transformation[42]. In USIS the mortgage score royalty flows fully into cost, so the second-quarter adjusted EBITDA margin fell from 35.0% to 32.8%[40], while the margin excluding FICO was 40.5%, up 140 basis points[11]. Second-quarter operating income for the three segments totaled $501 million[43]; management also doubled its 2026-2028 AI-driven cost reduction target from $75 million to $150 million[4].

The cash chain adds back large depreciation and amortization to profit and subtracts capex that is mostly capitalized software, and short collection cycles support good cash conversion. The 10-K said capex over the next twelve months would be below the then-current level[44], yet first-half 2026 capex rose $26 million year over year because of higher capitalized software and technology infrastructure spending[12]; over the same period receivables absorbed $91 million and other assets absorbed $119 million, so operating cash flow did not grow with profit[13]. On capital allocation, management said it will complete the Círculo deal, keep leverage below 3 times EBITDA and continue buybacks in the second half at a slower pace than in the first[45].

Industry and Competitive Position

U.S. consumer credit reporting is a three-bureau oligopoly, and the mortgage market depends on a tri-merge report built from all three bureaus' data, so any regulatory change in how that report is used hits revenue directly. The 10-K warns that a significant drop in U.S. mortgage credit activity would hurt revenue and operating profit in both EWS and USIS, and that changes in data pricing among the bureaus or regulatory changes affecting tri-merge use could also affect revenue and earnings[46]. On scores, FICO raised mortgage score prices sharply and the bureaus pass the royalty through to lenders, which lifts USIS mortgage revenue but depresses reported margin[47]. Equifax is promoting VantageScore, promising to price it at $1 per pull through the end of 2027, and says a full shift to VantageScore would add $40 million to $50 million of annual margin, but the FHFA currently approves only about 20 to 23 lenders to use it in agency mortgages[48].

The scale of EWS data is Equifax's clearest advantage, but the verification business itself does not have high barriers to entry. The 10-K acknowledges competition from employers that handle verifications in-house, lenders that go directly to employers and many online and offline verification firms, and third parties may obtain payroll or bank data directly through consumer consent[49]. On the second-quarter call, the company said The Work Number held 217 million active records, up 10%, with 124 million current active records covering 108 million unique Social Security numbers, against about 250 million income-producing Americans[45]; that leaves room for a higher hit rate, but it also means the uncovered half of the population needs other ways to verify.

Policy is the largest source of new government business for EWS and also the largest uncertainty for the whole company. A 2025 federal law added income and work verification requirements for SNAP and Medicaid, and management sees government verification as roughly a $5 billion addressable market[48]; meanwhile, the CFPB has issued three civil investigative demands since 2023 over EWS data accuracy and dispute handling, and the investigation is ongoing[50]. The limits of the available comparison also matter: Equifax does not disclose mortgage credit inquiry volumes, reports U.S. mortgage revenue and EWS government, mortgage and talent revenue only as growth rates rather than amounts, and defines revenue and margin excluding FICO on its own basis[11], so cross-company share comparisons can only indicate direction.

Core Debates

Growth at Equifax's income-verification platform, The Work Number, slowed from 14% to 7% in the second quarter as government benefit-verification revenue fell 4%. Can the government business stop declining in the third quarter and lift Workforce Solutions growth back above 8%?

This debate goes to the core engine of Equifax's profit. EWS was about 43% of 2025 revenue[20], contributed about 47% of second-quarter adjusted EBITDA and earns an operating margin of about 45%[11][42]; government verification has been one of the fastest growth sources in EWS over the past two years, and Verification Services grew 8% in 2025, mainly from government, talent and consumer lending[51]. The third quarter is the first test of whether the second-quarter slowdown was a one-quarter comparison issue or weaker demand.

The evidence so far shows the slowdown concentrated in one vertical, government, while other customer groups kept growing quickly. First-quarter Verification Services revenue was $571 million, up 14%, driven mainly by government, mortgage and talent[52][53]; in the second quarter it was $608 million, up 7%, with talent and consumer lending growing at high double digits and mortgage up 8%, while government fell 4%, which the company attributed to a tough 2025 comparison[54][11]. EWS segment revenue was $705 million in the second quarter (versus $662 million a year earlier) and $683 million in the first (versus $619 million, up 10%)[10][52]; the EWS adjusted EBITDA margin was 52.1% in the second quarter and 52.3% in the first[34][31]. In the first half the government team signed about $300 million of annual contract value, of which about $100 million is new business that mostly contributes revenue in 2027 and about $200 million is renewals, and management said the pipeline is twice last year's[48].

The financial transmission is direct: verification requests from benefit agencies and lenders, multiplied by the hit rate and price that 217 million active records support, become Verification Services revenue, and after data revenue share and capitalized software amortization they land in an EWS adjusted EBITDA margin of about 52%[45][42]. What remains unresolved is that a competing explanation also fits: government revenue may stay weak until new contracts go live, leaving EWS growth this year dependent on talent and consumer lending, which are sensitive to the hiring and credit cycles. Because the new contracts mainly turn into revenue in 2027[55], third-quarter revenue cannot directly test the quality of those signings.

The third-quarter report has five indicators to watch: whether EWS revenue grows at least 8%, whether Verification Services growth returns above 8% and the government vertical turns positive, whether the EWS adjusted EBITDA margin holds 52%, the go-live timing and new annual contract value of government contracts, and whether active records keep growing about 10%. Verification Services grew only about 5% in the third quarter of 2025, an easy comparison; if EWS still cannot exceed 7% against that base, the "comparison and timing" explanation becomes hard to sustain. If EWS growth falls below 6%, the slowdown is more than a government comparison problem; if the government decline widens, the boost from the new law slips past 2027.

Equifax's U.S. mortgage revenue grew 25% to 38% in the first half, but much of that was FICO score royalties passed through to lenders; excluding them, USIS mortgage revenue grew only in the mid-single digits. With originations still weakening in the third quarter, can Equifax's own pricing and verification penetration sustain roughly 20% mortgage revenue growth for the year?

Mortgage drives both USIS and EWS, and it is the main reason Equifax's revenue growth this year sits above its long-term framework. Full-year reported revenue guidance calls for growth of 10.5% to 11.6%[6], while guided growth excluding FICO royalties is 7.2% to 8.4%, in line with the long-term 7% to 10% organic framework[7]. Because FICO royalties go almost entirely into cost, the more revenue growth relies on pass-through, the more reported margin is diluted, so investors need to separate revenue growth from profit growth; the third quarter is also a seasonally strong mortgage quarter and the first full quarter since the company cut its origination assumption.

The evidence so far shows a wide gap between reported growth and the growth of Equifax's own share. U.S. mortgage revenue grew 38% in the first quarter, mainly from activity in January and February before rates rose[30][56]; it grew 25% in the second quarter, with USIS mortgage up 40%[4], about mid-single digits excluding FICO, while USIS overall grew 17%, or 6% excluding FICO[11], and EWS mortgage grew 8%, which the company said outperformed underlying market volumes by high single digits[55][11]. The 10-Q attributes Online Information Solutions growth to mortgage product pricing and higher volumes[57][58], and for two straight quarters it has attributed the lower USIS operating margin to higher mortgage-related royalty costs[59][60]. On margins, the USIS second-quarter adjusted EBITDA margin was 32.8% (35.0% a year earlier) and 40.5% excluding FICO, and first-quarter margin excluding FICO was 37.9%[40][61].

The transmission starts with interest rates and housing activity, runs through purchase and refinance applications, and becomes the number of tri-merge reports and income verifications that lenders pull, multiplied by a price made up of Equifax's own pricing, passed-through FICO royalties and new products, before landing in USIS and EWS revenue; because FICO royalties go fully into cost of services, the margin excluding FICO is the one that reflects real operating leverage[62][47]. What remains unresolved is a competing explanation: the first-half surge may have come mostly from passing through FICO price increases and from a brief window before rates rose in the first quarter, leaving Equifax's own share growing only in the mid-single digits. In July the company cut its full-year origination assumption to the low end of a "down low single digits" range, yet it kept guidance for U.S. mortgage revenue growth just above 20%[7].

The third-quarter report should show whether U.S. mortgage revenue grows at least 15%, whether USIS mortgage excluding FICO is still growing, whether EWS mortgage keeps outperforming the market by high single digits, whether the USIS margin excluding FICO expands year over year, and whether the company changes its origination assumption or full-year mortgage revenue guidance. If U.S. mortgage revenue growth falls below 10%, the full-year guidance of just above 20% is at risk of a cut; if USIS mortgage growth excluding FICO turns negative, revenue growth and profit growth will clearly diverge.

Equifax's nearly $3 billion cloud migration is in its final stage, and the company has promised more than $1 billion of free cash flow in 2026. Yet first-half capital spending rose and free cash flow was only about $326 million. Can third-quarter margins excluding FICO and capital spending start to show the payoff from the cloud transformation?

The cloud migration has been Equifax's largest capital commitment of recent years, and management presents post-cloud margin expansion and accelerating free cash flow as the funding source for buybacks, dividends and the Círculo deal[34]. Free cash flow above $1 billion for the year requires about $674 million in the second half, double the first half[7]; the third quarter is the first test of that pace and the first quarter since the company doubled its AI cost-reduction target in July[4].

The evidence so far shows improving margins alongside lagging cash flow. Capex fell from $601 million in 2023 to $481 million in 2025, and 2025 free cash flow was about $1.134 billion[25]; but first-quarter 2026 capex was $120 million (versus $107 million a year earlier)[63], first-half capex totaled $255 million, up $26 million[12], and first-half free cash flow was about $326 million, below about $356 million a year earlier[13]. On margins, the second-quarter adjusted EBITDA margin was 32.5%, flat year over year[5], and nearly 35% excluding FICO, up 120 basis points and 40 basis points above guidance[45]; first-quarter adjusted EBITDA was $477 million at a 29.0% margin[31], and second-quarter 2025 adjusted EBITDA was $499 million[64].

The transmission works like this: once the migration is complete, parallel legacy systems and migration costs fall and less software is capitalized, so capex declines, though amortization of already-capitalized software keeps rising[18]; lower technology and cloud costs plus AI-driven operating and development savings lift the margin excluding FICO, which passes through operating cash flow minus capex to fund buybacks, dividends and acquisitions. Management said the $150 million of AI savings affects both operating expense and capex, and part of it is already in second-quarter margins[48]. What remains unresolved is a competing explanation: the costs freed by the migration may be absorbed again by new products (a 16% new product Vitality Index in the second quarter) and AI investment[55], keeping capex around $500 million a year, with any cash improvement coming mainly from working capital and second-half seasonality.

The third-quarter report should show whether the adjusted EBITDA margin excluding FICO lands at or above the 34.6% to 35.0% range, whether adjusted EBITDA is at least $547 million[7], whether quarterly capex falls back below about $126 million (the second-half 2025 quarterly average), whether quarterly free cash flow reaches about $337 million and the company reaffirms more than $1 billion for the year, and how much of the $150 million AI savings target has been realized. If capex keeps rising year over year, the cash payoff from the cloud transformation is delayed; if the margin excluding FICO falls below 34.6%, the margin-expansion story takes a hit.

Risks and Falsifiers

The first risk is regulation and litigation, which weighs on both GAAP operating income and mortgage report revenue. The CFPB investigation into EWS data accuracy and dispute handling has been running since 2023[50], and in the second quarter the company accrued $100 million to settle claims over a previously disclosed coding issue, a $40 million net charge after $60 million of expected insurance proceeds[33], which pushed second-quarter operating margin down to 18.5% (20.2% a year earlier)[32]. The use, pricing and score models of tri-merge mortgage reports are set by the FHFA and the GSEs' rules, so a regulatory change would hit both the mortgage-report portion of USIS Online Information Solutions ($1.821 billion of revenue in 2025) and EWS mortgage revenue[46][21]. If the third-quarter report contains no new major settlement charge or regulatory penalty, and the company cites no revenue impact from changes in tri-merge use or mortgage scoring rules, the current understanding holds.

The second risk is capital allocation and leverage, exposed through interest expense, total debt and the pace of buybacks. First-half buybacks of $560 million and dividends of $134 million exceeded free cash flow of about $326 million, the gap was filled with commercial paper, and total debt rose from $5.114 billion at the start of the year to $5.485 billion[35][37]; second-quarter interest expense was $59.8 million, up 13%, at an average cost of debt of 4.4%[65], and the $825 million Círculo purchase price is due in the fourth quarter[24]. International results are also exposed to weak markets in Canada and the U.K. and to currency[66]. If third-quarter free cash flow covers the dividend and starts to reduce commercial paper, and the company keeps leverage below 3 times EBITDA and closes Círculo on schedule in the fourth quarter, this risk has not materialized.

The third risk is that government verification revenue keeps falling before new contracts go live, in a verification business with low barriers to entry. The exposure is EWS revenue ($2.582 billion in 2025) and segment operating income ($1.142 billion, 63% of the three-segment total)[19]; on 2025 revenue, each percentage point of slower EWS growth is worth about $26 million of annual revenue, which flows to profit at an EBITDA margin of about 50%. Competition comes from employers verifying in-house, lenders contacting employers directly and firms that obtain data through consumer consent[49], and the first-quarter call also listed the timing of government contract activations and the effect of AI on manual verification as risks[67]. If third-quarter EWS revenue grows at least 8%, the government vertical turns positive and the company cites no government contract losses or pricing concessions, this risk is falsified.

The fourth risk is a change in the pricing or regulation of mortgage scores and tri-merge reports, which would move both USIS revenue and margin. FICO price increases lift revenue through royalty pass-through while depressing margin[47]; substitution by VantageScore is gated by the FHFA approval pace, and FICO has proposed an alternative mortgage-score pricing model that could slow that substitution, though management said the proposal has gained no meaningful market traction[66]. The exposed lines are USIS Online Information Solutions revenue and the USIS adjusted EBITDA margin (32.8% reported and 40.5% excluding FICO in the second quarter), along with EWS mortgage verification revenue, whose amount is not disclosed. If third-quarter U.S. mortgage revenue grows at least 15%, the USIS margin excluding FICO expands year over year and the company cites no regulatory change to tri-merge use or pricing, this risk has not materialized.

The fifth risk is that the cloud transformation delivers less than expected or brings new migration costs, exposed through capex, depreciation and amortization and full-year free cash flow guidance. The 10-K acknowledges that migration is complex and costly, that problems in the remaining migration would require extra spending, and that amortization of capitalized software will keep lifting depreciation and amortization[18]; 2025 capex was $481 million and depreciation and amortization was $727 million[28], and first-half 2026 capex was already up $26 million year over year[12]. If third-quarter capex is flat or down year over year, the margin excluding FICO is at least 34.6% and the company reaffirms full-year free cash flow above $1 billion, this risk is falsified.

What to Watch Next

• Whether EWS can reaccelerate: second-quarter EWS revenue was $705 million (up 7%), Verification Services grew 7%, government fell 4% and the adjusted EBITDA margin was 52.1%. EWS growth of at least 8% with government turning positive would confirm; EWS growth below 6% or a wider government decline would falsify. Also watch go-live timing for new contracts and active-record growth.
• Quality of mortgage revenue: second-quarter U.S. mortgage revenue grew 25%, USIS mortgage 40% (about mid-single digits excluding FICO), EWS mortgage 8%, and the USIS margin excluding FICO was 40.5%. U.S. mortgage growth of at least 15% with year-over-year expansion in the margin excluding FICO would confirm; U.S. mortgage growth below 10% or negative USIS mortgage growth excluding FICO would falsify. Also watch for changes to the origination assumption and the just-above-20% guidance.
• Cash payoff from the cloud: second-quarter margin excluding FICO was nearly 35%, capex was $135 million and first-half free cash flow was about $326 million. A margin of at least 34.6%, adjusted EBITDA of at least $547 million and capex at or below about $126 million would confirm; capex still rising year over year or a margin below 34.6% would falsify. Also watch whether the company reaffirms more than $1 billion of free cash flow and how far the AI savings have progressed.
• Cross-cutting risk, leverage and the acquisition: commercial paper was $1.397 billion and total debt $5.485 billion at the end of June. Free cash flow covering the dividend, leverage below 3 times and an on-time Círculo close would confirm; commercial paper rising instead of falling would falsify.

Conclusion

Equifax's business runs on three forces: verification request volume and hit rates at The Work Number, the U.S. mortgage cycle, and lower costs and capex after the cloud migration. In the second quarter of 2026 revenue was $1.700 billion, up 11%[4], and adjusted EPS was $2.25[5], but much of the reported growth came from royalties passed through to FICO, and excluding them revenue grew about 7%[45]; EWS growth slowed to 7%, and first-half free cash flow was about $326 million while buybacks and dividends together came to $694 million, with borrowing covering the difference[13][35]. The central unresolved relationship is whether, with mortgage originations weakening and new government contracts not contributing revenue until 2027, growth and margin expansion excluding FICO can turn into the more than $1 billion of full-year free cash flow management has promised[7].

Between the second-quarter report and the third-quarter report, the outside material available consisted mainly of brokers adjusting their views on the stock and news coverage of the regulatory debate over mortgage credit-reporting fees; none of it offered an independent analysis of these three questions with original text that could be checked. For now, any judgment on the EWS slowdown, the quality of mortgage revenue and the payoff from the cloud transformation rests on the company's own disclosures and guidance without independent outside cross-checking, and that coverage gap should be stated plainly.

The combination that would materially strengthen the current understanding is third-quarter EWS revenue growth back above 8% with the government vertical turning positive, USIS mortgage revenue excluding FICO still growing with an expanding margin, and capex falling while the adjusted EBITDA margin excluding FICO lands at or above 34.6% to 35.0%. Conversely, if EWS growth falls below 6%, U.S. mortgage revenue growth drops below 10%, or capex keeps rising year over year and the promise of more than $1 billion of full-year free cash flow is cut, the current understanding would be clearly weakened.

Sources

[1] EFX 10-K filed 2026-02-19 · reportable segments and service lines · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[2] EFX 10-K filed 2026-02-19 · The Work Number and verification fees · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[3] Drillr earnings calendar (updated 2026-10-17) · EFX 2026-10-20 call · 2026-10-17 · Drillr earnings calendar

[4] EFX 8-K filed 2026-07-21 · 2Q26 results headline · 2026-07-21 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[5] EFX 8-K filed 2026-07-21 · 2Q26 adjusted EPS and EBITDA margin · 2026-07-21 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[6] EFX 8-K filed 2026-07-21 · 3Q26 and FY2026 guidance table · 2026-07-21 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[7] EFX Q2 2026 earnings call 2026-07-21 · guidance · 2026-07-21 · earnings-call · https://gateway.drillr.ai/mcp/private

[8] Drillr analyst_financial_estimates (updated 2026-10-16) · EFX quarter ending 2026-09-30 · 2026-10-16 · Drillr analyst_financial_estimates · https://gateway.drillr.ai/mcp/private

[9] Drillr analyst_financial_estimates (updated 2026-10-16) · EFX FY2026 · 2026-10-16 · Drillr analyst_financial_estimates · https://gateway.drillr.ai/mcp/private

[10] EFX 10-Q filed 2026-07-21 · Workforce Solutions segment results 2Q26 · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[11] EFX Q2 2026 earnings call 2026-07-21 · segment performance · 2026-07-21 · earnings-call · https://gateway.drillr.ai/mcp/private

[12] EFX 10-Q filed 2026-07-21 · capital expenditures 1H26 · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[13] EFX 10-Q filed 2026-07-21 · consolidated cash flows 1H26 · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[14] EFX 10-Q filed 2026-07-21 · 2026 outlook assumptions · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[15] EFX 10-K filed 2026-02-19 · people and footprint · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[16] EFX 10-K filed 2026-02-19 · tri-merge mortgage credit reports · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[17] EFX 8-K filed 2026-04-21 · 1Q26 CEO commentary on cloud and AI · 2026-04-21 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[18] EFX 10-K filed 2026-02-19 · technology transformation risk · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[19] EFX 10-K filed 2026-02-19 · segment operating income 2025 · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[20] EFX 10-K filed 2026-02-19 · segment share of revenue 2025 · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[21] EFX 10-K filed 2026-02-19 · revenue disaggregation 2023-2025 · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[22] EFX 10-K filed 2026-02-19 · Verification Services product description · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[23] EFX 10-Q filed 2026-07-21 · seasonality · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[24] EFX 10-Q filed 2026-07-21 · Círculo de Crédito agreement · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[25] EFX 10-K filed 2026-02-19 · key performance indicators 2023-2025 · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[26] EFX 10-K filed 2026-02-19 · operating revenue drivers 2025 · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[27] EFX 10-K filed 2026-02-19 · cost of services change 2025 · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[28] EFX 10-K filed 2026-02-19 · consolidated cash flows 2023-2025 · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[29] EFX 10-K filed 2026-02-19 · equity transactions 2025 · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[30] EFX 8-K filed 2026-04-21 · 1Q26 results headline · 2026-04-21 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[31] EFX 8-K filed 2026-04-21 · 1Q26 segment adjusted EBITDA · 2026-04-21 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[32] EFX 10-Q filed 2026-07-21 · key performance indicators 2Q26 and 1H26 · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[33] EFX 8-K filed 2026-07-21 · 2Q26 legal settlement accrual · 2026-07-21 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[34] EFX 8-K filed 2026-07-21 · 2Q26 Workforce Solutions results · 2026-07-21 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[35] EFX 10-Q filed 2026-07-21 · share repurchases and dividends 1H26 · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[36] EFX 10-Q filed 2026-07-21 · balance sheet June 30, 2026 · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[37] EFX 10-Q filed 2026-07-21 · debt at June 30, 2026 · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[38] EFX 8-K filed 2026-07-29 · $1.0 billion senior notes offering · 2026-07-29 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[39] EFX 8-K filed 2026-07-29 · use of notes proceeds · 2026-07-29 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[40] EFX 8-K filed 2026-07-21 · 2Q26 USIS and International results · 2026-07-21 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[41] EFX 10-K filed 2026-02-19 · cost of services composition and drivers · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[42] EFX 10-Q filed 2026-07-21 · Workforce Solutions operating margin 2Q26 · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[43] EFX 10-Q filed 2026-07-21 · segment operating income 2Q26 · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[44] EFX 10-K filed 2026-02-19 · planned uses of capital · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[45] EFX Q2 2026 earnings call 2026-07-21 · management highlights · 2026-07-21 · earnings-call · https://gateway.drillr.ai/mcp/private

[46] EFX 10-K filed 2026-02-19 · mortgage market and tri-bureau risk · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[47] EFX 10-K filed 2026-02-19 · USIS operating margin and mortgage royalty costs · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[48] EFX Q2 2026 earnings call 2026-07-21 · Q&A on government ACV, AI savings, VantageScore and M&A · 2026-07-21 · earnings-call · https://gateway.drillr.ai/mcp/private

[49] EFX 10-K filed 2026-02-19 · competition · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[50] EFX 10-K filed 2026-02-19 · CFPB investigation of Workforce Solutions · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[51] EFX 10-K filed 2026-02-19 · Verification Services revenue drivers 2025 · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[52] EFX 10-Q filed 2026-04-21 · revenue disaggregation 1Q26 · 2026-04-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[53] EFX 10-Q filed 2026-04-21 · Verification Services drivers 1Q26 · 2026-04-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[54] EFX 10-Q filed 2026-07-21 · Verification Services drivers 2Q26 · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[55] EFX 8-K filed 2026-07-21 · 2Q26 CEO commentary · 2026-07-21 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[56] EFX 8-K filed 2026-04-21 · 1Q26 CEO commentary and guidance stance · 2026-04-21 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[57] EFX 10-Q filed 2026-04-21 · Online Information Solutions drivers 1Q26 · 2026-04-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[58] EFX 10-Q filed 2026-07-21 · Online Information Solutions drivers 2Q26 · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[59] EFX 10-Q filed 2026-04-21 · USIS operating margin 1Q26 · 2026-04-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[60] EFX 10-Q filed 2026-07-21 · USIS operating margin 2Q26 · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[61] EFX Q1 2026 earnings call 2026-04-21 · segment performance · 2026-04-21 · earnings-call · https://gateway.drillr.ai/mcp/private

[62] EFX 10-K filed 2026-02-19 · USIS revenue drivers 2025 · 2026-02-19 · 10-K · https://www.sec.gov/Archives/edgar/data/33185/000003318526000010/

[63] EFX 8-K filed 2026-04-21 · 1Q26 cash flow statement · 2026-04-21 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[64] EFX 8-K filed 2026-07-21 · 2Q25 segment adjusted EBITDA · 2026-07-21 · 8-K · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=8-K&dateb=&owner=include&count=40

[65] EFX 10-Q filed 2026-07-21 · interest expense and debt 2Q26 · 2026-07-21 · 10-Q · https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000033185&type=10-Q&dateb=&owner=include&count=40

[66] EFX Q2 2026 earnings call 2026-07-21 · stated risks · 2026-07-21 · earnings-call · https://gateway.drillr.ai/mcp/private

[67] EFX Q1 2026 earnings call 2026-04-21 · risks and Q&A · 2026-04-21 · earnings-call · https://gateway.drillr.ai/mcp/private